When Your Agent Buys Rather Than Sells Your Property
by Tim O’Dwyer M.A., LL.B Queensland Solicitor & Consumer Advocate watchdog@argonautlegal.com.au
It has always been the law across Australia that real estate agents must act fairly towards their clients and disclose all relevant matters to them. One of the most fundamental principles of this Common Law duty of “utmost good faith” is that an agent simply must not buy a client’s property. 
More particularly, an agent must not directly or indirectly be involved or beneficially interested in the purchase of any client’s property listed with the agent for sale – unless a fair price is being paid and the agent obtains an informed consent in writing from the client before entering into the sales contract.
Naturally enough agents are not entitled to any commissions from sellers on such sales, which my fellow Consumer Advocate, Neil Jenman, labels as “insider trading”.
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2 Comments
We believe that our real estate agent and one of the officers working with our non-bank lender ganged-up to sell our property to a buyer chosen by them, at a ridiculously low price, blocking all potential buyers who could pay us the true market value.
They both know of our extremely poor financial position and we had to auction our home, in order to repay the home loan.
Kindly advise what evidence do we require to prove insider trading and how serious is this malpractice?
Hi Anwar,
I would suggest that you write to the estate agent and to the lender and tell them exactly what you believe and why you believe it. Give them the opportunity to explain the situation to you.
If you are satisfied with the explanation, well and good. However, if their explanations are not satisfactory, probe them a little further.
If, after all of the written (and I do emphasise that you MUST ensure that everything is in writing – don’t let them explain things away in a telephone call) discussion you are still not satisfied, you will be in a good position to pursue the matter further. This is because you will have covered all of the common ground, identified the issues in dispute, and will be able to pursue the issues that matter.
Feel free to contact me if you need assistance once you have discussed the matter with the agent and the lender.