Established real estate agencies are reportedly using sales contracts that aren’t legally binding, putting their commission and the agency’s revenue at risk.
That was the surprise finding following the launch of O*NO Legal‘s REAL Health Check and Membership program last week.
The innovative offering involves an overall assessment of an agency’s current legal standing across different facets of their business, followed by an option to sign up for one of three membership options.
The membership options allow agencies affordable access to legal advice and practical assistance, depending on their budget and requirements.
O*NO Legal Founder and Legal Strategist, Kristen Porter, said even she was surprised at the number of agencies that were using non-compliant contracts. But perhaps not as surprised as the agencies themselves.
“They were very surprised,” Ms Porter said.
“We did a spot check of 10 contracts, and all 10 were non-compliant. If all the boxes aren’t ticked, you’re not entitled to any commission, and therefore your income, and agency revenue, is at risk.”
The health checks also revealed many agencies’ databases also posed a problem.
“A lot of agencies discovered that their employee relationships weren’t as solid as they thought, putting their database at risk.
“Insurance was another recurring issue, particularly around which insurances you might actually need.”
Fortunately, these issues are fairly easily fixed, which is where the membership options come into play.
Following the REAL Health Check, which will identify any issues, O*NO Legal will provide the necessary tools to ensure your agency is legally covered across the board.
It’s then up to the agency whether they want practical support – and how much – when it comes to choosing their membership level.
Ms Porter said the most popular option was ‘done with you’, which leaves implementation up to the agency, but offers support and check-ins along the way.
“They’ve got the tools to do it themselves, but they have that peace of mind that we’ll come together and ensure everything is on the right track,” she said.
The other options on either end of the spectrum are ‘done by you’ and ‘done for you’.
Done by you sees agencies given the tools to address their action items themselves, while the done for you option sees the O*NO Legal team take care of everything on the agency’s behalf.
Ms Porter believes the reason the launch was so successful was because it provided an opportunity for agencies of all sizes to access quality legal advice.
“Everyone assumes real estate agents are rolling in money, but they’re still small business owners,” she said.
In fact, start-ups in the early stages of development made up the largest percentage of those that took part in the launch.
“They want to set themselves up from the beginning, so they have solid foundations in place for the future,” Ms Porter said.
“There were also a few group heads that reached out to inquire about the prospect of putting franchisees through the program.
“Franchisees are the future of the larger organisations, and our program provides a value-add for those business owners, and provides peace of mind to franchisors, that each office is legally protected.”
