The Real Estate Agents Act 2008 was established to protect consumers and promote public confidence in the performance of real estate agency work. Raising industry standards is an important aspect of this, and we develop and publish professional standards to support this.
Professional Standard on Supervision
All licensees holding a salespersons class of licence must be supervised when doing real estate agency work regardless of how long they have been working in the industry.
A salesperson must be properly supervised and managed by an agent or a branch manager. Supervisors must ensure that all salespersons are complying with the Act, including employees and independent contractors.
The Professional Standard on Supervision (2017) describes best practice in the supervision of salespersons.
The following sections are described in more detail in the supervision standard document.
Download the Professional Standard on Supervision [PDF, 101 KB].
Key topics within the supervision standard
Properly supervised and managed
Proper supervision and management means that sufficient direction and control is provided to the salesperson to ensure their agency work is performed competently and complies with the requirements of the Act.
Supervision is not the same as employment line management
Only a licensed agent or licensed branch manager can be a supervisor.
A salesperson’s line manager may also be their supervisor, or a salesperson may have a separate supervisor and line manager. Whatever the situation, all parties must be clear that supervision under the Act is not the same as management of an employment relationship.
Each salesperson must have a clearly defined designated supervisor or supervisors. A written supervision plan/ agreement is an effective means of ensuring a salesperson is aware of who their supervisor is and how supervision will operate.
The ultimate responsibility for supervision sits with the designated supervisor.
Actual, active and tailored to the circumstances
The nature and degree of supervision will vary from salesperson to salesperson based on their experience and competence and the operating conditions.
The frequency, mode and intensity of supervision may vary in each case. The supervisor is expected to exercise judgement that takes account of each salesperson’s experience and training, the complexities of the real estate market in which they are operating, the nature of the transactions performed and the requirements of the client or customer.
Supervisors are not expected to sight and direct every aspect of a salesperson’s real estate agency work. However, a supervisor should be actively and regularly involved with a salesperson’s activity.
Drafting sale and purchase agreements
A salesperson with less than six months’ real estate agency work experience cannot prepare sale and purchase agreements or provide advice to clients about their legal rights and obligations.
The supervisor should review every agreement. Supervisors must be actively involved in agreements drafted by inexperienced salespersons or those not maintaining a consistently high standard of drafting. This includes reviewing agreements before the parties sign them.
New and inexperienced salespersons
Supervisors need to take extra care when supervising a new and inexperienced salesperson.
Supervisors may change the nature and degree of supervision as a salesperson demonstrates increased competence and experience.
Read more about supervising new salespersons here.
The law does not require a salesperson to be supervised in the presence of the supervisor. However, at all times, the salesperson needs to be under sufficient direction.
It doesn’t matter where the supervisor and salesperson are physically located — the requirement is the same. The salesperson must be ‘properly supervised and managed’, which means working under sufficient ‘direction and control’ to ensure competence and compliance with the Act.
Remote supervision is allowed, but care must be taken. More effort will be required to set up the supervision arrangement and to make the relationship work. Regular communication between the salesperson and the supervisor is imperative.
Number of salespersons that may be supervised by a supervisor
A supervisor may supervise more than one salesperson.
The number of salespeople that can be effectively supervised will depend on the supervisor’s capacity, capability and location, and the level of experience and competence of each salesperson being supervised.
We recommend that supervisors keep supervision records in addition to a supervision plan and agreement. The form and extent of record keeping should reflect the nature of the supervision.
Effective supervision is tailored to the individual. The following questions are intended to support the development of agency supervision plans:
- Do employment contracts include the details of the supervising agent or branch manager? Are these reviewed and updated as situations change?
- Do you understand the level of knowledge and the strengths and weaknesses of the people you supervise? Is your supervision plan appropriate for their level of knowledge?
- Do you have more stringent supervision for licensees new to the industry or to your organisation?
- Does your supervision plan differ for staff working remotely?
- Do you review every sale and purchase or lease agreement presented by licensees you supervise?
- Is the work of the licensees you supervise randomly reviewed and recorded?
- Do the people you supervise have a training and development plan? Are the outcomes of these plans recorded in writing?
We have developed a two-hour supervision training programme for agents and branch managers. The programme counts towards non-verifiable continuing education. Supervision standards is one of the mandatory topics for all licensees in 2018 continuing education.
Read more about continuing education here.