Agency agreements

When you enter into an agency agreement (including a joint sole agency) with someone who is selling a property, you need to meet a number of requirements that are set out in the Real Estate Agents Act 2008 and the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012 (Code of Conduct).

Things you must do before an agency agreement is signed

  • Explain the risk of paying a commission if a previous agency is not cancelled

    You need to warn the vendor they could be at risk of paying two commissions if the buyer has been introduced by another agent or if they have an existing agency agreement that has not been cancelled.

    You must also warn them that, if they cancel the agency agreement with you and then sell privately to a person introduced by you, they may still be liable to pay a commission.

  • Provide a written price appraisal of the property

    This is your estimate of the sale price of the property. It must reflect current market conditions realistically and be supported by comparable information about sales of similar properties. This applies to all transactions, including commercial leases.

    If it is not possible to provide comparable information, you should say so in the appraisal.

  • Discuss the different options for selling the property

    Explain the sale options, for example, by tender, auction or at an advertised price. You must also explain any rebates you receive from each sale method.

    Download Form 1: Agent's statement relating to rebates, discounts, and commissions [PDF, 223 KB]

  • Provide a clear written estimate of your commission

    This should explain how the commission will be calculated, the conditions under which it must be paid and the estimated total sum they will pay based on the estimated sale price.

    Be clear about whether the figures are inclusive or exclusive of GST.

  • Provide a copy of the agency agreement guide (if it's a residential sale)

    Provide a copy of the agency agreement guide (if it's a residential sale)

    You must give the vendor a copy of the New Zealand Residential Property Agency Agreement Guide [PDF, 275 KB] before they sign the agreement and ask them to confirm in writing that they have received it.

    You can email the guide or give them a printed copy.

  • Explain marketing and advertising costs

    You must explain how the property will be marketed and advertised. Make it clear what advertising you provide as part of your service and what the vendor would be charged for.

    Read more about marketing and advertising

  • Disclose rebates, discounts and commission

    You must include a statement about any rebates, discounts or commission you will receive and specify the amount. You are not entitled to receive any expenses from a vendor if this information is not included in the agency agreement. 

    Download Form 1: Agent's statement relating to rebates, discounts, and commissions [PDF, 223 KB]

    Read more about disclosures

  • Inform the vendor if you have a conflict of interest

    If you have a conflict of interest, for example, if you or someone connected to you is interested in buying the property, you must inform the vendor and follow the prescribed process.

    Read more about conflict of interest

  • Recommend that the vendor seeks legal and other advice before signing

    You must recommend that the vendor seeks their own legal advice and give them a reasonable amount of time to do this before signing the agency agreement.  

    Make sure they are aware they can and may need to seek technical or other advice and information.

    On link), we recommend that sellers get legal advice before signing the agency agreement.

  • Explain to the vendor when the agency agreement will end

    You must explain when the agency agreement ends and how the vendor can cancel it.

  • Provide information about how to make a complaint

    You must explain that your agency has an internal complaints procedure for dealing with complaints and that the vendor may complain to REA without first using your in-house complaint process.

    Read more about the complaints process

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