Estate Agents Act 1980

The Act’s primary subjects are licensed estate agents (natural persons or corporations holding an estate agent’s licence under s.21) and agents’ representatives (persons employed or authorised by a licensed agent to perform estate-agency functions other than clerical work—s.4(1)). From 25 November 2025 the 2025 amendments create a new category of “registered agent’s representative”, but the substantive obligations remain aligned with the pre-existing representative regime.

Directors and officers in effective control of corporate agents are personally exposed: a corporation cannot be licensed unless it has a licensed officer in effective control (s.15(1)), and that officer must be regularly and substantially in attendance at the principal office, supervise staff, and establish compliance procedures (s.29B). Breaches can lead to personal disqualification or conditions (s.31D).

Sellers and purchasers of residential property are protected by the pricing and disclosure rules. A seller must receive a reasonable estimated selling price before signing an engagement (s.47A) and must be notified of any revision (s.47AE). Purchasers receive a statement of information at inspections (s.47AF(4)).

The Authority, the Director, VCAT, and inspectors appointed under the Australian Consumer Law and Fair Trading Act 2012 are the regulatory actors. The Secretary to the Department of Government Services administers the Fund (s.72(2)).

Financial institutions holding trust accounts must report overdrafts (s.59(5A)) and comply with freezing orders (s.89). Auditors (approved under s.66) owe statutory duties of independence and reporting.

Builders, subdividers, and certain government bodies are partially exempt (s.5) but remain subject to the anti-false-representation rules in Part V.

Finally, any person who suffers pecuniary loss from a defalcation by an agent or their employee may claim against the Fund (s.80), giving the legislation a third-party beneficiary dimension.

Agents’ duties include:

• Maintaining a current licence and ensuring representatives are eligible (ss.12, 16).
• Ensuring estimated selling prices are reasonable and calculated by reference to three comparable sales (ss.47AB, 47AC).
• Preparing and displaying a statement of information (s.47AF).
• Disclosing commission sharing and rebates (ss.48, 49A).
• Banking trust money promptly and not mixing it with office funds (s.59).
• Keeping full accounting records and having them audited annually (ss.63, 64).
• Supervising representatives and branch offices (ss.13A, 29B, 30).
• Not purchasing property they are engaged to sell without informed consent and fair-market-value compliance (s.55).

Representatives’ duties mirror many of the above plus a personal obligation to be eligible and not misrepresent that eligibility (s.16(2)–(3)). From 2025 they must also undertake continuing professional development (s.37M).

Consumer rights are both direct and indirect. A seller may recover commission paid if the agent breached the pricing or disclosure rules (s.55A). A purchaser misled by under-quoting may have remedies under the Australian Consumer Law. Any person suffering loss from a defalcation has a statutory right to claim against the Fund (s.80), with interest and costs (s.80(4)–(5)).

Regulatory rights are extensive. The Director may investigate disputes (s.56A), require substantiation of pricing (s.47D), and issue guidelines (s.47AD). Inspectors have entry, search, seizure, and questioning powers, including warrant and consent pathways (ss.70I–70N). The Authority may impose conditions, suspend, or cancel licences after VCAT inquiry (ss.21A, 28A).

Rights of the Fund include subrogation to the claimant’s rights (s.84) and the ability to freeze trust accounts on suspicion of defalcation (s.89).

Penalties are graduated. The most serious licensing offences carry 500 penalty units (individual) or 1 000 penalty units (corporation) plus up to 12 months’ imprisonment (s.12). Under-quoting, false pricing, and repeated rebate breaches attract 240 penalty units (ss.47A, 47B, 47C, 48D). Trust-account and audit breaches are 120 penalty units (ss.59(1)(c), 64(1)). Lesser record-keeping and notification breaches are 25–60 penalty units.

Infringement notices may be issued for prescribed offences (s.95A). VCAT may impose fines up to $5 000 in addition to disciplinary orders (s.28A(2)). Criminal prosecutions are brought by the Director or authorised officers (s.95).

The Fund itself is protected by automatic cancellation of licences on bankruptcy or certain convictions (s.22), personal liability of officers (s.29B), and the power to freeze accounts (s.89). Recovery actions include forfeiture of profits earned while unlicensed (s.94A) and civil recovery of rebates (s.48E).

The Act is not a code. It expressly cross-references:

• Corporations Act 2001 (Cth) for definitions of “accounting records”, “books”, “externally administered body corporate”, and “private corporation” (s.4(1)).
• Australian Consumer Law and Fair Trading Act 2012 (Vic) for the Director’s functions, inspector appointments, and application of investigation powers (ss.9, 70W, 93A).
• Sale of Land Act 1962—breaches feed into fitness inquiries and VCAT disciplinary action (ss.25(1)(aa), 28(1)(ca)).
• Owners Corporations Act 2006, Retirement Villages Act 1986, Residential Tenancies Act 1997, and Rooming House Operators Act 2016—the Fund may be used for related dispute-resolution and consumer-advocacy costs (s.75(1)(ea)–(hh)).
• Sentencing Act 1991—the Fund is subrogated to compensation orders (s.84).

The Act sits alongside the Australian Consumer Law (misleading conduct, unconscionable conduct) and common-law fiduciary duties. Section 97 preserves civil liability; an agent who breaches the Act may still face damages actions for breach of contract or tort.

The 2025 amendments align the new registration regime for agents’ representatives with the Consumer and Planning Legislation Amendment (Housing Statement Reform) Act 2025, adding mandatory CPD and record-keeping obligations.

The most significant recent changes are in the Consumer and Planning Legislation Amendment (Housing Statement Reform) Act 2025 (commencing 25 November 2025). That Act:

• Introduces mandatory continuing professional development (new s.37M).
• Creates a registration system for agents’ representatives (transitional ss.107–109).
• Abolishes the Estate Agents Council (Division 4 of Part IX).

These changes respond to the Victorian Government’s Housing Statement, which identified inadequate ongoing training and inconsistent oversight of sales staff as contributors to under-quoting and consumer detriment.

Earlier, the Estate Agents Amendment (Underquoting) Act 2016 inserted ss.47A–47AF and strengthened penalties to 240 penalty units after a 2015 review found systemic under-quoting that distorted auction clearance rates and disadvantaged vendors.

The Justice Legislation Miscellaneous Amendment Act 2018 clarified that rebate statements need not contain certain statements if they use the Director-approved form (s.49A(6)–(7)), resolving litigation uncertainty.

Each reform has been driven by consumer complaints, market inquiries, and a desire to keep the legislation aligned with national consumer-policy trends.

The leading controversy concerned rebate statements. In Advisory Services Pty Ltd t/as Ray White St Albans v Augustin [2018] VSCA 95 the Court of Appeal held that a rebate statement omitting the statutory declarations required by the then-current form of s.49A(4) rendered the engagement unenforceable, allowing vendors to avoid commission. The 2018 amending Act responded by validating approved-form statements, but only prospectively for engagements entered after Royal Assent (s.104).

Under-quoting litigation has tested the reasonableness standard in s.47AB. VCAT and the Supreme Court have emphasised that an estimate must be based on genuinely comparable sales and not merely an optimistic “guide” designed to secure the listing. Repeated breaches within 12 months can trigger the higher 240-penalty-unit offence (s.48D).

Challenges to the breadth of inspector powers under Part VI Division 2 have been rare but have confirmed that the statutory purpose of “monitoring compliance” authorises proactive, non-specific audits rather than requiring a particularised suspicion of breach.

The automatic-cancellation provisions in s.22 have produced litigation on the timing of convictions and the effect of appeals (s.22A), with VCAT adopting a protective rather than punitive approach when considering applications for limited rights under ss.31A–31C.

Most practitioners still miss three recurring traps.

First, the estimated-selling-price obligation is personal and continuous. An agent who obtains a listing with a compliant estimate but later becomes aware (or ought to become aware) that the estimate is no longer reasonable must notify the seller in writing and revise the engagement (s.47AE). Failure to do so within a reasonable time can lead to both disciplinary action and commission forfeiture under s.55A. The 10 % range rule is strictly applied; even a 10.1 % spread invalidates the estimate.

Second, trust-account “unidentified money” has a 12-month fuse. Section 59A requires electronic payments that cannot be matched to a client to be treated as unclaimed money under the Unclaimed Money Act 2008 after 12 months. Many agents assume they can simply transfer such sums to their office account; doing so risks defalcation proceedings and personal liability for directors.

Third, the officer-in-effective-control obligation (s.29B) is not satisfied by appointing a licensed director who is rarely present. VCAT has cancelled corporate licences where the nominated officer attended the principal office less than three days per week or failed to implement documented compliance procedures. The statutory language—“regularly and usually in charge” and “give regular and substantial attendance”—is interpreted literally.

Another subtle trap: an agent who accepts a cheque made payable to a third party (e.g. a conveyancer) in prescribed circumstances is relieved from the s.59 trust-accounting obligation (s.59(8)(b)), but only if the precise regulatory conditions are met. Misapplication can convert an administrative oversight into a criminal mixing of funds.

Finally, the 2025 registration regime for agents’ representatives does not automatically carry across prior police-check certificates. Agents must obtain fresh certificates within six weeks of the commencement day or risk the representative becoming ineligible (transitional s.108).

A practical compliance program should contain at least the following elements:

1. Licensing and eligibility — Maintain a register of all representatives, obtain police certificates no older than six months (or six weeks for new employees—s.16(4)), and diarise annual licence and registration renewals. Use the Authority’s online portal to track changes of details (s.24B).

2. Pricing and marketing — Adopt a written comparable-sales methodology that records the three (or fewer) most comparable properties, their sale dates, and adjustments for condition and location (s.47AC). Retain working papers for at least seven years. Implement a “price-review trigger” checklist that forces file review whenever a new comparable sale occurs or the property has been on the market 30 days without offers.

3. Engagements and disclosures — Use only Director-approved forms containing the exact rebate statement required by s.49A(4). Have a second person check every engagement for the required commission, rebate, and complaint-handling statements before it is signed. Scan and store the signed original electronically with an audit trail.

4. Trust accounting — Use only authorised financial institutions (s.60). Reconcile trust accounts monthly, not just at audit time. Implement a “three-day rule” diary for unidentified electronic receipts (s.59A). Train all staff that mixing office and trust money is a strict-liability criminal offence.

5. Supervision — The officer in effective control must sign a monthly compliance certificate confirming attendance, procedure adherence, and representative oversight. Keep minutes of monthly compliance meetings.

6. CPD and registration — From 25 November 2025, maintain individual CPD logs for every representative and the agent’s own mandatory activities (s.37M). Upload completion records to the Authority’s portal before each annual registration anniversary.

7. Audit readiness — Keep all source documents (contracts, bank statements, comparable-sales files) in a single electronic folder per transaction. Engage an approved auditor early in the financial year and provide the statutory declaration required by s.64(14) on time.

8. Incident response — Have a pre-drafted “defalcation response plan” that includes immediate notification to the Director, freezing of relevant accounts, and cooperation with inspectors. Remember that the Fund can pursue the agent for any payout (s.84).

9. Record retention — Adopt a seven-year minimum retention policy for all trust records, engagements, and CPD logs (ss.63(3), 98). Use secure, searchable electronic storage that satisfies the “readily accessible and convertible into written form” test (s.63(2)).

10. Annual health check — Commission an independent compliance audit each year that tests a sample of files against the pricing, disclosure, and trust-account rules. Remediate gaps before the statutory auditor arrives.

By embedding these steps into standard operating procedures, an agency can move from reactive risk management to demonstrable, auditable compliance that satisfies both the Director and VCAT. The cost of compliance is modest compared with the 240-penalty-unit fines, commission forfeiture, and reputational damage that follow a serious breach.