FAQ – Updates to the PO Form 6 REIQ Schedule – 19 September 2022

Sales,  Principals,  Salespeople

Watch our free webinar on the latest updates to the PO Form 6 sales schedule.

1. Why has the REIQ released a new update to the PO Form 6 REIQ Residential Sales Schedule?

Since the current version of the PO Form 6 REIQ Residential Sales Schedule was released on 30 August 2022, we have received significant feedback from Sales Agents that they felt the Schedule included too much information and caused an excessive administrative and time burden.

We have taken this feedback onboard and developed a new updated version to simplify the form, while still keeping an option to include the property details, disclosure and compliance information that the REIQ recommends including in your PO Form 6 for best practice.  

2. What has been updated?

The REIQ Residential Sales Schedule has been reduced to 4 pages, including only basic information about the appointment.

The property details and disclosure information has been extracted into an optional Annexure which will appear with the Schedule in Realworks when the PO Form 6 is created.  Sales Agents can remove the Annexure if they do not want to use it.

Please see Question 6 below for how to complete the Annexure and use the Information Request feature in Realworks to request the Client to complete most fields in the Annexure.

PO Form 6 graphicPO Form 6 graphic

3. Is my PO Form 6 still valid if I don’t use the Annexure?

Provided your PO Form 6 is completed correctly, it will still be valid if you choose not to use the Annexure.

The REIQ strongly recommends that the Annexure is included or, that the Client provides the information contained in the Annexure at a later stage but before entering into a Contract for Sale.  The purpose of the Annexure is to limit the risk of a Contract falling over and protect your commission.

Some of the information provided is necessary to fulfil the seller’s requirements to provide disclosure to a prospective buyer prior to entering into a Contract for Sale.  If the REIQ Contract is used, the buyer may have a termination right if a matter that the seller has warranted is not disclosed at the Contract date.

If you do not want to complete the Annexure at the PO Form 6 stage, you can choose to send this Annexure to the Client separately at a later date.  We recommend this is done as soon as possible after the PO Form 6 is entered in case there is important information about the property that you may need to know to avoid making errors or misrepresentations when marketing the property and responding to queries regarding it.

4. Will the new features in Realworks still work?

 Yes, there have been no changes to the features in Realworks that Sales Agents may use to streamline the preparation of sales Contracts.

Once the PO Form 6 is completed, you can then create a Related Form, for example:

  • EF001 Contract for Residential Houses and Land; or
  • EF003 Contract for Residential Lots in a Community Titles Scheme,

and the information captured in the PO Form 6 will automatically populate in the relevant field in the Contract.   The information in the Annexure will only populate if the Annexure is used.

 

PO Form 6 graphic

Look out in the sidebar of the Contracts where you’ll find the Merge feature that allows you to search for any completed EF157 Notice of Offer to Purchase form to automatically populate the completed fields from the Notice to the Contract including:

  • The buyer’s details;
  • The purchase price;
  • The deposit amount and due date;
  • The building and pest condition due date;
  • The finance condition due date;
  • Any special conditions; and
  • The settlement date.

PO Form 6 graphic

5. What if I have an existing PO Form 6 in progress? Will I have to start again?

 You do not need to start a new PO Form 6 if you have a draft one in progress.  If you click on this form, Realworks will prompt you to update the form and the information will be populated into the new version of the form.

 6. How do I complete the Annexure?

The Annexure contains the following sections, which you will likely be familiar with from the former PO Form 6 and the REIQ Contract Schedule:

  • Property description
  • Pool, smoke alarms and safety switch compliance
  • Matters affecting the property (from the title search)
  • Tenancy information
  • Disclosure questions
  • Financial details
  • Client’s solicitor details
  • Details for Lots in a Community Titles Scheme

The information entered in these sections that have matching fields in the REIQ Contract Schedule will automatically populate into the Contract, if a Related Form contract is created in Realworks.

You can also use the Information Request feature in Realworks to request your client to complete certain fields.

PO Form 6 graphic

7. What is the Verification of Identity in Item H?

We have kept the Verification of Identity and Facts Material to Sale of Property sections to ensure your appointments are valid and compliant with the Property Occupations Regulation 2014. 

We have simplified Item H to prompt Sales Agents to take reasonable steps to verify the identity of their clients and ownership of the property they are being appointed to sell.

There are a couple of reasons why this has been included.  Agents are required to take reasonable steps to identify their clients’ ownership under s19 of the Property Occupations Regulation and this section helps to ensure real estate professionals comply with this legal requirement.

It is also best practice to ensure the client is properly identified because of the increase in fraudulent transactions and incidents that target the real estate profession.

This new section also prompts the client to provide copies of any documents which give them authority to deal with the property, such as a power of attorney.

8. What if my client doesn’t know about the disclosure matters in the Annexure?

If your client is not aware of the matters for disclosure listed in the Annexure, it is ok if you do not complete this section in full.  You should recommend that they seek legal advice as they may need to make disclosure under clause 7 of the relevant REIQ Contract.  The questions included are existing disclosure requirements under the REIQ Contract.  Each question relates to a specific seller’s warranty given under clause 7 of the REIQ Contract.

This disclosure information should be obtained from the seller prior to preparing a Contract so that you can meet your obligations, as the seller’s agent.

For example, under the current REIQ Contract for Sale of Residential Houses and Land:

  • The seller warrants under clause 7(1)(g) that the property is not heritage listed at the contract date;
  • The seller warrants under clause 7.4(2)(d)&(e) that there are no outstanding obligations on the seller of notifiable activity being conducted on the land, and the seller is not aware of any facts that may lead to the land being classified as contaminated (ie. the land is not listed on the Environmental Management Register or Contaminated Land Register); and
  • The seller warrants under clause 7.7(1)(a) that the present use of the land is lawful.

If the client is not aware of the answer to these questions, they should seek legal advice.  In most cases they should be aware.  A special condition drafted by a legal practitioner may be required to deal with the disclosure item.

9. Does my client have to get GST advice?

The new GST section is a prompt for the client to seek financial advice about the GST implications of their sale.  It is not always clear whether GST is applicable and can have significant financial consequences for the client if they don’t receive the appropriate advice prior to entering the Contract.

The REIQ will be releasing a Webinar for the Residential PO Form 6 Update on 20 September 2022.  This Webinar will go over the new update to the PO Form 6 and how to use the new features in Realworks.

If you have any questions and you are an REIQ Member, please call the Agency Advice Service on 1300 697 347.

Additionally, REIQ CEO Antonia Mercorella covers the updates in this recent Facebook Live video.

Watch our free webinar on the latest updates to the PO Form 6 sales schedule.

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