New South Wales agents' rules of conduct: duties, disclosure, penalties

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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A licence lets a person work as an agent in New South Wales. The rules of conduct say how that work has to be done once the licence is in hand: how honest, how careful, how loyal to the client, and what has to be said to the person on the other side of the sale. They are short, they are written in plain terms, and each one can be enforced.

This guide follows the text of the rules as the New South Wales legislation website publishes them in the Property and Stock Agents Regulation 2022, and the three NSW Fair Trading pages that explain them to agents: the rules of conduct page, the misrepresentation page and the disciplinary action page, each last updated on 8 July 2026. It covers the general rules that bind every agent, the rules written for sales work, the list of material facts a prospective buyer must be told, and the amounts and sanctions those pages give for a breach. It describes the general rule; how a rule applies to one sale depends on the facts of that sale.

NSW Fair Trading, rules of conduct page, last updated 8 July 2026.

Where the rules of conduct sit in the law

Two texts carry the rules. The Property and Stock Agents Act 2002 is the Act of the New South Wales Parliament that licenses agents. The Property and Stock Agents Regulation 2022 is made under it; it commenced on 1 September 2022 and replaced the 2014 Regulation. The version date of the in-force text was not read for this guide.

Section 8 of the Regulation, made for section 37 of the Act, is the provision that switches the rules on. It says the rules of conduct are set out in Schedules 1 to 4 and states who each schedule applies to. Schedule 1 applies to all agents and assistant agents. Schedule 2 is for real estate agents and is split in two: Part 1 for those dealing with the sale or purchase of land, and for business agents; Part 2 for leasing and for on-site residential property managers. Schedules 3 and 4 cover stock and station agents and strata managing agents.

NSW Fair Trading's rules of conduct page sums this up as 21 core rules for all licence and certificate holders, plus the specific rules that follow the kind of work done. The count matches the Regulation: Schedule 1 runs to 22 clauses, and the last is marked as repealed.

A sales agent in a suburban office therefore works under two sets at once: every clause of Schedule 1, and Part 1 of Schedule 2. An agent who also manages rentals adds Part 2. This guide stays with Schedule 1 and the sales part.

The five duties that frame everything else

The first five clauses of Schedule 1 are the foundation, and each is a single sentence or two.

Clause 1 is about knowledge. An agent must know and understand the Act, its regulations and the other laws relevant to the category of licence or certificate held. The clause names the fields: residential tenancy, fair trading, competition and consumer protection, anti-discrimination and privacy. The standard is practical. The knowledge required is what is needed to exercise the agent's functions lawfully.

Clause 2 says an agent must comply with the fiduciary obligations that arise from acting as an agent. The Regulation does not list those obligations; it points to the duties that the law already attaches to anyone who acts for another person. Clause 6, described below, adds the duty to act in the client's best interests at all times.

Clause 3 has two parts. An agent must act honestly, fairly and professionally with all parties to a transaction, and must not mislead or deceive a party in negotiations or a transaction. The words "all parties" matter. A selling agent's client is the vendor, yet the duty of honesty in clause 3 is owed to the buyer as well.

Clause 4 requires reasonable skill, care and diligence. Clause 5 bans three kinds of behaviour by name: high pressure tactics, harassment, and harsh or unconscionable conduct. Neither clause is limited to clients, and neither defines its terms further in the Schedule.

Read together, the five clauses describe a person who knows the law of the job, is loyal to the client, straight with everyone, careful in the work and never coercive. The remaining general rules apply that description to particular moments of a file.

Acting for the client: authority, instructions, confidences

Four clauses govern the relationship between agent and client.

Clause 6 is the best interests rule: an agent must act in the client's best interests at all times, unless doing so would be contrary to the Act or the regulations, or otherwise unlawful. The exception matters. On this guide's reading, the duty to the vendor does not extend to conduct the Act prohibits, such as the misrepresentation offence described further down.

Clause 8 says an agent must not act as an agent for a person, or represent that they are acting as one, without that person's written authority. The Schedule carves out one case, a sale solely of livestock. The clause reaches the claim as well as the act: without written authority, the agent may not even represent that they are acting.

Clause 9 mirrors clause 6. An agent must follow a client's instructions, with the same exception for instructions that would be contrary to the Act or regulations or otherwise unlawful. The client directs the work within the law; under the wording of the clause, an instruction cannot oblige an agent to commit a breach.

Clause 7 protects confidences. An agent must not use or disclose confidential information obtained while acting for a client or dealing with a customer. The Schedule gives two ways out: the client or customer authorises it, or the law permits or compels it. The clause covers customers as well as clients, so what a buyer tells a selling agent in confidence is protected too. It covers use as well as disclosure.

Confidentiality and disclosure meet in the clause's own wording: the confidence yields where the law permits or compels disclosure. On this guide's reading, the prescribed material facts described further down are a case of that kind.

Conflicts of interest, referrals and gifts

Clause 11 is short: an agent must not accept an appointment, or continue to act under one, if doing so places the agent's interests in conflict with the client's. NSW Fair Trading's page describes the same duty from the other side. Agents must declare potential conflicts to clients and must not enter commercial arrangements that place their own interests before their clients'.

Clause 12 deals with one form a conflict can take, the referral. An agent must not falsely represent that a service provider is independent of the agent. The clause then defines independence. A provider is independent only if the agent receives no rebate, discount, commission or benefit for the referral and has no personal or commercial relationship with the provider. The examples of such relationships given in the clause include family, business and fiduciary ties, and cases where one person is accustomed or obliged to follow the other's directions.

Where the provider is not independent, clause 12 requires two disclosures: every relationship, and the nature and value of any rebate, discount, commission or benefit received or expected. NSW Fair Trading adds a condition in its guidance: the referral must be made only if it is in the client's best interests.

Clause 13 concerns one kind of referral. An agent must not recommend a solicitor, a licensed conveyancer or a firm that the agent knows acts, or will act, for the other party. The Schedule allows an exception where no other solicitor, conveyancer or firm is available, and in that case the agent must tell the person that the recommended professional acts for the other side. The text read for this guide appeared to tie that exception to a remote location; its exact scope was not confirmed.

Clause 14 looks outward. An agent must not offer a gift, favour or benefit, in money or otherwise, to induce a third person to engage the agent. Gifts coming the other way are dealt with in the Act itself. According to NSW Fair Trading, section 53F generally prohibits receiving or requesting gifts or benefits where they could reasonably be seen as creating a conflict of interest. The exceptions the page lists are items provided by the employer, items under an agency agreement or a client's thank-you gift, and items under A$60, the amount prescribed by clause 20 of Schedule 1. Principal licensees must keep a register of gifts received by agents.

Paperwork, material particulars and the office

Four clauses are about documents, and they are the ones a client meets first.

Clause 15 says an agent must not submit or tender a document to a person for signature, or cause or permit that to happen, unless all material particulars have been inserted at the time. The Schedule does not define "material particulars". The clause is aimed at the blank or half-completed form: a person is asked to sign only what is already filled in.

Clause 16 follows. An agent who submits a document for signature must give the person a copy immediately after they sign it. The word in the clause is "immediately"; the Schedule allows no later date.

Clause 17 bans two false statements. An agent must not falsely represent the nature or effect of a provision of the Act or the regulations. Nor may an agent falsely represent, expressly or by implication, that a particular form of agency agreement, or a particular term, is required by law. A vendor who is told that a clause "has to be in there" is entitled to that being true.

Clause 18 closes the set: an agent must not enter into an agency agreement that does not comply with the Regulation's requirements for such agreements. The terms themselves are in Schedules 5 and 6 of the Regulation, which this guide does not go through.

Three more general rules are addressed to how a business is run. Clause 10 puts a duty on the licensee in charge to take reasonable steps to ensure that the other licensees and registered persons in the business comply with the Act and the regulations.

Clause 21 requires the licensee in charge to ensure there are separate trust accounts for rental money and for sales money, and that each kind is paid into the correct account. Clause 19 requires rental money owed to a landlord under a residential tenancy agreement to be paid at the end of each calendar month, less authorised expenses, unless the landlord instructs otherwise.

The extra rules for sales agents

Part 1 of Schedule 2 adds rules for the sale and purchase of land. They follow a sale in the order it happens.

The Part was read for this guide in summary form, so its clause numbers are not cited. Before acting for a vendor, an agent must physically inspect the property and then give the vendor a signed sales inspection report. Once the property is on the market, the agent must inform the vendor of all offers until exchange of contracts, unless the vendor instructs otherwise in writing. The rule does not apply to bids at an auction.

Expression of interest deposits have their own rules. Before accepting one, the agent must give written information and must obtain a signed statement from the person paying. If another person enters into a contract to buy the property, the deposit must be refunded within 14 days. NSW Fair Trading's page adds that the vendor's agent must promptly tell the client about the deposit.

Two rules deal with referral fees between the two sides: there are to be no referral fees between a vendor's agent and a buyer's agent. Four rules are written for buyer's agents, who must give a signed statement of property details, keep the buyer informed, use best efforts to obtain the best price, and not go above a client's maximum price without written authorisation, at auction included.

Three rules cover the end of a campaign. An agent who bids for a telephone bidder needs a written authority in which the bidder acknowledges the conditions of sale. A reserve price cannot be set aside without the vendor's express permission. And the contract must be served within 2 business days.

Misrepresentation under section 52 of the Act

Section 52 of the Act is where honesty stops being a conduct rule and becomes an offence. As NSW Fair Trading sets it out, a licensee or certificate holder must not induce a person to enter a contract or arrangement in either of two ways. The first is a statement, representation or promise that is false, misleading or deceptive, whether or not the agent knew it was. The second is a failure to disclose a prescribed material fact that the agent knows or ought reasonably to know about, whether the failure was intended or not.

The misrepresentation page stresses that silence counts. A false impression can come from what is left unsaid as well as from what is said. Agents must not conceal information that is not readily apparent. If a statement that was correct becomes incorrect because something changes, the change must be passed on. And when a buyer asks a question the agent knows the answer to, the answer must be frank and full; when the agent does not know, the page says to get the answer from the vendor or refer the person to a conveyancer or a relevant expert.

Liability does not depend on knowledge, but the page records one defence: proving that the agent did not know, and had no reasonable cause to suspect, that the statement was false, misleading or deceptive.

Predictions are covered as well. The page refers to the Australian Consumer Law, under which a representation about the future made without reasonable grounds is taken to be misleading. Untrue or unsubstantiated predictions about property values or returns fall inside that rule.

The material facts a buyer must be told

NSW Fair Trading defines a material fact as one that would be important to a reasonable person in deciding whether to proceed with a transaction. In property, that means facts that may influence a decision to buy or rent, or that could affect market value.

Section 60 of the Regulation turns part of that idea into a fixed list for the purposes of section 52 of the Act. The table sets out the list with the look-back period each item carries.

The list is precise where precision is possible. The drug item refers to the Drug Misuse and Trafficking Act 1985. The orders in the last row are those made under the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020. Section 60 borrows its definitions of "external combustible cladding", "fire safety order" and "building product rectification order" from other New South Wales legislation. One item carries no period in the list as read for this guide: "significant health or safety risks".

Finding out and telling: what Fair Trading expects

The duty reaches facts the agent "ought reasonably to know", so the misrepresentation page spells out what reasonable looks like. Agents are to take reasonable steps to find out whether any prescribed material fact applies. At a minimum, the page says, that means making appropriate inquiries with the property owner. Agents are also to check the facts they could reasonably find themselves; the page gives flood, bush fire and loose-fill register listings as examples.

Strata records are a separate point. If an agent holds strata records that contain relevant material facts, the page says they are to be disclosed.

On timing, the page leaves room for judgement and sets no fixed moment for disclosure.

Finally, the page addresses the vendor who does not tell the truth. Liability is unlikely, it says, where the vendor deliberately concealed the fact when questioned. On this guide's reading, that ties back to the inquiry with the owner, which the page gives as the minimum step.

What a breach can cost in money

The NSW Fair Trading pages give three sets of amounts, and they come from three different routes.

The penalty notice is the lightest route. The disciplinary action page says penalty notices are used for less serious offences and that payment is not an admission of liability.

A worked example shows the distance between the routes, on the assumption that one breach of a rule of conduct is dealt with either by notice or by a court that imposes the maximum. For an individual, A$22,000 is 20 times the A$1,100 notice. For a corporation, A$110,000 is 50 times the A$2,200 notice. The disciplinary ceiling sits between the two: A$11,000 for an individual and A$22,000 for a corporation, each 10 times the matching notice.

For misrepresentation under section 52, the misrepresentation page states a maximum court penalty of up to A$110,000 and gives no separate figure for an individual. The disciplinary action page lists heavier court penalties for other offences, outside the rules of conduct: up to A$110,000 for a corporation and A$55,000 for an individual for unlicensed trading, and up to 10 years' imprisonment for trust account fraud, an indictable offence.

Disciplinary action, from show cause to disqualification

Money is one outcome. The licence is the other. According to the disciplinary action page, anyone can complain to NSW Fair Trading about a breach, and the regulator can investigate and act whether or not a complaint has been made.

The grounds are wide. Action can be taken against a current or former licence or certificate holder who breaches the Act or the Regulation, the rules of conduct included. The page's list also names a breach of other laws such as the Australian Consumer Law, a breach of a licence condition, conducting business in an unlawful, improper, unfair or incompetent manner, ceasing to be "fit and proper", and failing to pay a monetary penalty imposed in earlier disciplinary action.

The page says that, in situations of serious risk, immediate suspension is possible.

The actions available at the end range from mild to final. At one end are a caution or reprimand, an undertaking, a directive, and a condition on the licence or certificate. Then come the monetary penalty, suspension for no longer than the unexpired term of the licence or certificate, and cancellation. At the far end is disqualification, either from holding a licence or certificate or from managing or directing a licensee, permanently or for a set period.

Some of the listed actions are specific to selling. Fair Trading can require an independent valuer to verify the estimated selling prices or require the licensee in charge to approve those estimates. It can also require public disclosure of the misconduct in a specified way, and an indemnity for claims against the Compensation Fund.

A person who disagrees with a disciplinary decision can ask for an internal review and, if still dissatisfied, apply to the NSW Civil and Administrative Tribunal. The page does not state the time limits for either step.

A client's instruction ends where the law begins: no clause of Schedule 1 asks an agent to choose loyalty over honesty.

Kooky, from Shaka

Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

About Kooky and Shaka →