NSW Real Estate Agent Reforms: Maximum Penalties Rise to $110,000 as Business Compliance Requirements Tighten
On 29 October 2026, NSW Fair Trading issued an announcement outlining significant changes introduced by the Property and Stock Agents Amendment (Underquoting and Other Agent Conduct) Act 2026 and associated regulations.
The reforms primarily address real estate agents’ sales practices, price advertising, disclosure obligations and penalties for non-compliance. They aim to improve transparency in property transactions, strengthen industry oversight, and reduce misleading sales practices.
Notably, the maximum court-imposed penalties for certain serious offences have increased to $110,000 for corporations and $55,000 for individuals. These offences include mishandling trust money.
For real estate agencies and property management businesses operating in NSW, understanding the legislative changes, strengthening internal controls and meeting compliance obligations are increasingly important.
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01 Phased Implementation: Key Dates for Real Estate Agencies
According to the official NSW Fair Trading announcement, the reforms will be implemented in three stages.
29 June 2026 (Already in Effect)
Increased maximum penalties for a range of offences involving real estate agents.
Expanded NSW Fair Trading’s disciplinary powers.
Introduced new regulatory powers relating to agency agreements.
Introduced a new offence of impersonating an NSW Fair Trading officer.
17 November 2026
Introduce new requirements for property sales, price advertising, and marketing.
Regulate real estate agency agreements and the determination of estimated selling prices.
Strengthen compliance requirements for sales pricing and record-keeping: agents must refer to actual sales data from comparable properties as prescribed, ensure estimated selling prices are reasonable and supported by evidence, and properly retain relevant pricing evidence and records of adjustments.
Require agents to revise estimated selling prices promptly where applicable.
8 February 2027
Strengthen property disclosure requirements: agents must prepare and display a Statement of Information where required, including basic details of the property offered for sale and comparable property sales data supporting the estimated selling price, and comply with applicable display, updating and record-keeping requirements.
Strengthen oversight of Continuing Professional Development (CPD) training providers: introduce a new approval framework requiring relevant training providers to meet NSW Fair Trading’s approval and compliance standards.
The phased rollout allows affected businesses to update their processes to comply with the new sales and disclosure requirements.
02 Stricter Sales Pricing and Disclosure Requirements
A central focus of the reforms is to strengthen price transparency and professional accountability during the property sales process.
2.1 Estimated Selling Prices Must Be Supported by Reasonable Evidence
From 17 November 2026, agents determining an estimated selling price must consider actual sales data from comparable properties in accordance with the prescribed requirements.
Agents must comply with the new sales pricing requirements by basing estimated selling prices on reasonable, verifiable market transaction data and retaining supporting documentation and records of adjustments. This will help them meet NSW Fair Trading’s regulatory requirements and reduce the risk of non-compliance and penalties.
2.2 Price Revisions and Advertising Must Comply with the Rules
If market feedback, buyer offers or other information indicates that an estimated selling price is no longer reasonable; agents must revise it promptly in accordance with the requirements and retain the supporting evidence.
Advertisements for residential properties within the scope of the rules must clearly state a sale price or price range, including advertisements on websites, social media and other electronic platforms.
If the advertised online price is below the agent’s estimated selling price, the highest genuine bid at a passed-in auction, or a written offer rejected by the vendor solely because it was too low, and the advertisement consequently fails to comply with the requirements, the agent must take reasonable steps to update or remove the advertisement within one business day.
2.3 New Statement of Information Requirements from 2027
From 8 February 2027, a Statement of Information must be prepared for residential property sales to which the requirements apply and retained for at least three years.
These measures are intended to reduce misleading practices such as underquoting and to provide buyers with more accurate and transparent information about property transactions
03 Higher Penalties: Maximum Fines of $110,000
In addition to tighter regulation of sales practices, the reforms significantly increase the maximum penalties for certain offences involving real estate agents.
From 29 June 2026, the maximum court-imposed penalties for specified offences are as follows:
Offender Maximum Penalty
Corporation $110,000
Individual $55,000
The offences covered include:
Carrying on real estate agency business without a valid licence.
Dummy bidding at property auctions.
Mishandling trust money.
In addition, for certain offences such as underquoting, the maximum court-imposed penalty is $110,000 or three times the agent’s commission, whichever is greater.
It is important to note that different offences may attract different penalties. The penalty imposed in any particular case depends on the applicable legislation and circumstances.
These increases highlight the need for real estate agencies to prioritise compliance in day-to-day operations and manage the heightened legal and financial risks associated with misconduct.
04 Trust Account Audit Requirements Remain Unchanged, but Trust Money Compliance Is More Important
The reforms also introduce an important consideration for real estate agencies and property management businesses that handle client trust money.
The amendments do not change the existing requirements for trust account audits.
In other words, the reforms do not directly amend existing trust account audit obligations, audit procedures, or audit requirements. Their primary focus remains real estate agents’ sales conduct and industry regulation.
However, the maximum court-imposed penalties for certain offences, including mishandling trust money, have increased to:
Corporations: $110,000
Individuals: $55,000
This change reinforces the importance of properly managing client trust money and meeting existing regulatory obligations.
For real estate agencies and property management businesses, maintaining accurate trust account records, following appropriate procedures for receiving and disbursing funds, establishing effective internal controls and meeting existing audit obligations remain essential components of everyday compliance management.
Although the reforms do not change the trust account audit requirements themselves, the increased penalties mean businesses should continue to prioritise trust money management and minimise potential compliance risks.
05 WIS Australia Compliance Reminder: Prepare Early and Reduce Risk
The NSW real estate agent reforms further demonstrate regulators’ focus on industry transparency, professional conduct and accountability for non-compliance.
Alongside higher penalties, NSW Fair Trading has been given broader disciplinary powers, including, where applicable, restricting agents from carrying out certain activities, requiring additional training and taking other regulatory measures.
WIS Australia recommends that real estate agencies and property management businesses focus on the following areas:
Sales process compliance: Review property advertisements, estimated selling prices, agency agreements and disclosures to ensure they meet the new requirements.
Record-keeping and internal controls: Ensure that the evidence supporting sales price assessments, client notifications and relevant transaction records is properly maintained.
Trust money management: Continue to comply with existing trust account management and audit requirements to ensure client funds are handled appropriately.
Implementation dates: Review and update relevant business processes in line with the commencement dates of each stage of the reforms.
As regulatory scrutiny and penalties increase, sound internal management, reliable financial records and ongoing compliance become even more important to the long-term operations of real estate agencies.
Sources
Disclaimer
This article reflects publicly available information regarding the exposure of draft legislation as at the date of publication and is general in nature. It does not constitute tax, financial, or legal advice and should not be relied upon without obtaining professional advice tailored to your specific circumstances. To discuss how these proposed changes may affect you or your business, please contact our advisory team at Wis Australia.
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