The Real Estate Authority (REA) has today released updated consumer guides on the property buying and selling process in seven languages to enable greater accessibility to REA’s consumer protection information about the real estate transaction.
The Residential Property Agency Agreement Guide and the Residential Property Sale and Purchase Agreement Guide, approved by REA under the Real Estate Agents Act 2008, provide an introduction to the purpose, contents and usage of the two standard types of contract used in real estate transactions. Licensed real estate professionals are required under the Real Estate Agents Act 2008 to issue these REA approved guides to residential buyers and sellers before they sign a sale and purchase agreement and to residential sellers before they sign an agency agreement.
REA’s Buying Journey Guide which maps out an end-to-end overview of the home buying process has also been updated and translated.
The guides are now available in English, te reo Māori, Tongan, Samoan, Hindi, Korean, and Simplified Chinese.
REA encourages licensees to provide consumers with the English version and a translated version where this will support consumer understanding.
REA Chief Executive/Registrar, Belinda Moffat says the guides have been translated into languages commonly spoken in New Zealand and which licensees have indicated they commonly encounter and use.
“REA is committed to providing essential information resources to help all New Zealanders confidently engage in real estate transactions and to make informed decisions. Buying or selling a house is often the most significant financial transaction anyone will enter into. We want to support consumers to understand what can be, a daunting and complex process,” explains Ms Moffat.
“The guides offer independent information about what consumers should expect during a real estate transaction, as well as some of the key risks and issues to watch for. Having these guides available in seven different languages is one way in which REA can inform, empower and protect more people, and to prevent consumer harm in the real estate transaction context.
“As the real estate conduct regulator, REA regulates licensed real estate professionals. We are also a consumer protection agency. REA provides information to consumers through its consumer website settled.govt.nz and these consumer guides. English is not the first language for many New Zealanders and our aim is to increase the accessibility of our consumer protection information, to help more members of New Zealand’s diverse communities participate confidently in real estate transactions.”
Importance of agreements in a property transaction
When a person plans to sell their property with the help of a licensed real estate professional, the licensee must prepare an Agency Agreement, which contains details about the property and what the seller has authorised the licensee to do on their behalf to market and sell it. It outlines the commission rate and marketing plan. The agency agreement needs to be signed by both parties before the licensee conducts any real estate agency work on behalf of the seller. The Residential Property Agency Agreement Guide provides information on how this process works.
A Sale and Purchase Agreement is the contract signed by both the seller and the buyer when a property is sold, and sets out all the details, terms and conditions of the sale, including the deposit price, conditions of sale and the settlement date. The Residential Property Sale and Purchase Agreement Guide provides information about the sale and purchase agreement process.
“Both agreements are legally binding contracts. While the consumer guides provide a general introduction to their purpose and contents, REA advises consumers to take legal advice on the specific contracts prepared for them before signing,” Ms Moffat says.
REA refreshed the guides following feedback from consumers and licensees, to improve their usability and to reflect REA’s commitment to supporting and informing New Zealand’s diverse communities. REA sought feedback from licensee representative REA Board members and REA’s industry advisory group. Translations were prepared by the Department of Internal Affairs translation service.
The new guides take effect from 14 October 2022. The current consumer guides may be used until 30 November 2022 under a transition arrangement.
View and download the new guides(external link)
Real Estate Agents Act 2008 (Act) requirements
Under section 127 of the Act an agent must provide a person with a copy of the Agency Agreement guide before they enter into an agency agreement with that person for the sale of a residential property.
Under section 133 of the Act an agent must provide a copy of the Residential Sale and Purchase Agreement Guide before a buyer signs a sale and purchase agreement for the sale of a residential property.
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