Property managers have until next year to comply with strict enforcement orders mandated by the NSW Department of Fair Trading around trust accounting.
The regulations, implemented on 1 September 2014, outline new rules for ethical and professional conduct for those involved in the real estate and property industry and are a result of public consultations being conducted in mid-2014.
The changes made to property agents’ responsibilities are being introduced under the Property, Stock and Business Agents Regulation 2014.
For property agents and principals, there will be new provisions regarding general trust accounts opened from 1 January 2015.
Separate trust accounts are exempt from the new requirement – this refers to separate trust accounts kept on the instructions of a client for the client’s benefit, or separate trust accounts kept for the benefit of both a vendor and a purchaser.
Licensees maintaining a trust account as at 31 December 2014 have a grace period until 30 June 2015 to comply.
Changes made include introducing unique identifying numbers to help Fair Trading monitor agents' trust accounts and safeguard consumer funds.
Property agents will need to use a unique identifying number issued by Fair Trading for all general trust accounts.
This number can be obtained from the NSW Government Licensing Service (GLS) site from 1 January 2015.
For existing general trust accounts, property agents will need to provide their bank with a unique identifying number obtained from GLS for each general trust account before 1 July 2015.
Before opening a new general trust account with a bank, from 1 January 2015, property agents will need to register their intention to open a general trust account with GLS. This will issue them with a unique identifying number that they can take to the bank to open the account.