What ethical obligations does a land agent have when a buyer makes an offer that the agent knows the vendor is likely to reject?

Q: What is the correct answer to: What ethical obligations does a land agent have when a buyer makes an offer that the agent knows the vendor is likely to reject?

The correct answer is The agent must present all genuine offers to the vendor, regardless of the amount, as it is the vendor's decision to accept or reject. Under SA fiduciary duty principles, an agent must present all genuine offers to the vendor promptly, regardless of the offer amount. The decision to accept or reject an offer belongs exclusively to the vendor. Agents cannot filter, delay, or withhold offers based on their own judgement.

Q: What background knowledge is needed for this Ethics Compliance question?

The duty to present all offers has been reinforced by disciplinary cases across Australian jurisdictions. Some vendors include specific instructions about offer thresholds in agency agreements, but absent such instructions, all genuine offers must be presented regardless of amount.

Q: What is a good way to remember the answer to this Ethics Compliance question?

Present every genuine offer promptly. Agent does not filter. Vendor decides to accept or reject — it is their choice alone. Remember: the agent is a messenger, not a gatekeeper for offers.

Q: What exam tip applies to this Ethics Compliance question?

Agents must present ALL genuine offers to the vendor — never filter, delay, or hold offers for any reason.

Q: How does this Ethics Compliance concept apply in Australian real estate practice?

A vendor's property is listed at $650,000. A buyer offers $520,000, well below the asking price. The agent considers it a waste of time but must present it to the vendor immediately. The vendor, needing a quick sale, accepts and is grateful the offer was communicated.

Question

Ethics ComplianceSAMEDIUM

What ethical obligations does a land agent have when a buyer makes an offer that the agent knows the vendor is likely to reject?

Answer Options

A

The agent can reject the offer without informing the vendor

B

The agent must present all genuine offers to the vendor, regardless of the amount, as it is the vendor's decision to accept or reject

C

The agent should tell the buyer to increase their offer before presenting it

D

The agent can hold the offer until a better one is received