CPP40307 Certificate IV in Property Services Risk Management Workbook

This document is a comprehensive workbook created for the CPP40307 Certificate IV in Property Services (Real Estate) course, focusing on risk management within the property industry. It covers various aspects, including interpreting and applying legislation, understanding industry codes and ethical practices, and effectively communicating updates to agency staff. The workbook includes activities that require students to access and interpret relevant legislation, such as the Property Stock and Business Agents Act 2002 and the Property Stock and Business Agents Regulation 2014, and to analyze specific clauses within agency agreements. A significant portion of the workbook involves a case study of Rickardo’s Realty, where students are tasked with identifying, evaluating, and treating risks within the agency's operations. This includes establishing the context, identifying risks, developing risk matrices, and creating treatment plans for unacceptable risks. The activities also address the development of teams and individuals, including training needs analysis, individual training plans, and coaching and mentoring strategies. The workbook culminates in a learner declaration, confirming the completion of the activities and understanding of the course content.

CPP40307 Certificate IV in Property Services
(Real Estate)
Learning activities workbook
Risk Management

Table of Contents
Introduction...........................................................................................................................3
Activity 1 – Access and interpret legislation..............................................................4
Activity 2 – Working with legislation............................................................................5
Activity 3 – Industry codes and ethical practice.......................................................6
Activity 4 – Communicating updates to agency staff.............................................7
Activity 5 – Maintaining records.....................................................................................8
Case Study.............................................................................................................................9
Part 1 – Risk Management.............................................................................................11
Activity 1 – Establish the context................................................................................11
Activity 2 – Identify and evaluate the risk................................................................12
Activity 3 – Treating the risk.........................................................................................14
Activity 4 – Preparing and documenting treatment plans..................................15
Part 2 Develop Teams and Individuals......................................................................16
Activity 5 – Training needs.............................................................................................16
Activity 6 – Individual Training and Performance Plan.........................................18
Activity 7– Review Training...........................................................................................19
Activity 8 – Non Training Activity.................................................................................20
Activity 9 – Coaching and Mentoring..........................................................................21
Learner Declaration..........................................................................................................22
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Introduction
This workbook contains activities from the units of competency:
 CPPDSM4002A Apply knowledge of state or territory legislative and regulatory
framework to complete agency work
 CPPDSM4009BInterpret legislation to complete agency work
 CPPDSM4015B Minimise agency and consumer risk
 BSBLED401 Develop teams and individuals
The activities contained in this workbook must be uploaded with your final
assessment.
These activities form part of the overall assessment of the units of competency
in this course.
Some of the activities may be done in class, some of the activities are a
reflection of your understanding of the course content and will be done in your
own time.
If you have any problems answering the questions or need further clarification,
then please speak with your Trainer.
REINSW recognises the individual needs of each learner and will provide
reasonable adjustment when required.
To complete this assessment, type your answers where you see the insertion
symbol.
You have limited formatting options.
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Activity 1–Access and interpret legislation
Locate the property Stock and Business Agents Act 2002
1. Name the Part, Division and Section that relates to:
 Duty not to act for both buyer and seller of land
 Display of name at registered office
 Confidentiality of bidders register
 Marketing statement about vendor bids when property passed in
Type Answer Below
Duty not to act for both buyer and seller of land- Division 48
Display of name at registered office- Division 29
Confidentiality of bidder’s register- Division 70
Marketing statement about vendor bids when property passed in- Division 76A
2. Select one of the Sections above and provide a summary
Type Answer Below
Division 29, is related with the display of the name at registered office by
showing legal name of the firm along with the description of the license.
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Activity 2 – Working with legislation
Locate the Property Stock and Business AgentsRegulation2014
1. Name the Schedule that provides the:
 Terms applying to all agency agreements
 Terms specific to agency agreements for sale of residential property
 Terms specific to agency agreements for management of residential or
rural land
 Terms specific to agency agreement for the leasing of residential
property or rural land
Type Answer Below
Agency agreements-Schedule 7
Sale of residential property-Schedule 12
Management of residential land- Schedule 10
Leasing of residential property- Schedule 8
2. Referring to an Exclusive Selling Agency Agreement or Exclusive
Management Agreement, highlight the clauses that are specific to the
schedules in the regulations.
Type Answer Below
There are various clauses in the exclusive selling agency agreements are
mention as below:
 Property details
 Names of client and agent
 Agent’s registrations number
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Activity 3 – Industry codes and ethical practice
Ethics and law differ in that ethics are social guidelines based on moral principles
and values, whilst laws are rules and regulations that have specific penalties and
consequences when breached. Ethics do not have punishments, fines or
associated penalties when people fail to abide by them.
Locate the REIA National Principles of Conduct (these are the fundamental
principles of conduct for REI members
Based on the above explanation of how ethics differ from law:
 Choose one (1) of the REI Principles of Conduct that relates to law (state
which Act etc)
 Choose one (1) of the REI Principles of Conduct that is ethical behaviour
but not law
Type Answer Below
To act in the best interest of the client
To act ethically, fair and honest
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Activity 4 – Communicating updates to agency staff
The Real Estate Institute of NSW is focused on ensuring that all member agents
not only understand their legal obligations but are continuously informed of
legislative and regulatory changes affecting the industry.
Access the REINSW website:
1. Give an overview of one piece of legislation that has had recent
amendments
2. Explain two other ways that you could use to advise an employee of how
to find further information on this matter
Type Answer Below
Currently, changes made to the legislation of strata window safety which will
applicable from 13th march 2018. Windows will lock at the height of 12.5cm to
avoid accidents.
http://www.reinsw.com.au/Web/Posts/Latest_News/201608/
Confusion_over_strata_window_safety.aspx
Two ways to seek changes in the legislations
 Federal registrar of legislation
 Index matters
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Activity 5 – Maintaining records
Locate the Property Stock and Business Agents Act 2002 and name the Part,
Division and Section of the Act that relates to Real Estate Agents requirement to
keep record of quotes.
1. What information must the record of statement contain?
2. What should an agent do when the estimate of selling price is adjusted?
Type Answer Below
A records statement contains the information about the selling price of the
property.
According to section 73 sub section 3 of the property stock and business agents
act 2002, will amend the advertisement of the property.
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Case Study
Rickardo’s Realty is a family owned agency that has been operating for over 10
years. They specialise in residential sales and property management and have a
rental portfolio of 250 properties.
Rickardo’s Realty originally had a strong hold on the local market and in 2015
moved to larger premises, however lately that seem to be losing market share.
When Rickardo’s moved to the new premises, they decided to diversify and add
a commercial sales and leasing department. At first they had some positive
response from some of the residential landlords who have both residential and
commercial properties, but have not been able to attract new business.
Rickardo who is the Licensee has a staff of:
Name Role Experience
Rose Property Management
Supervisor
12 years
Erica Property Management
Associate
3 years with another agency, 3
months with Rickardo’s
Roger Property Management
Representative
Just starting out in residential
management
Edward Property Sales Supervisor 6 years
Regina Property Sales Associate 2 years
Harry Property Sales Representative 6 months
Samuel Commission Only -
Commercial Sales
20 years residential, 5 years
commercial
Roxanne Sales Support
Is responsible for advertising,
research for property
appraisals and liaising with
solicitors
1 year, wants to be a sales person
Rebecca Reception 2 weeks on the job
Rosalind
Rickardo’s
wife
Accounts and helps with
property management
Does not hold a certificate of
registration
Ricky Jnr
Rickardo’s
son
Commercial Sales
(will be the head of the
department)
Recently completed licensing
course and gained licence (no
experience)
Renata
Rickardo’s
daughter
Reception on weekends Still at school
Rickardo recognises that here are a number of issues at his agency:
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 Property management department:
o Losing managements – six in the last 3 months
o Rose is often away from the office at NCAT, so none is available to
handle commercial management enquiries
o No new commercial managements in the last six months
 Sales department
o Unable to convert residential listing presentations into listings
o Deadlines for advertising missed – some properties not advertised
o Only 1 commercial sales listing
 Customer complaints, mostly about lack of follow up to enquiry and
problems
 Staff morale is not good, Harry often comes into work late and leaves
early. Roxanne gets upset with salespeople and is often heard complaining
that she is overloaded and can’t get all her work done.
 Rickardo is very concerned that the agency lost a large sales commission
due to a mistake in an agency agreement. He doesn’t blame Edward, but
worries that the same mistake could happen again
 The agents at Rickardo’s have been giving market appraisals without
doing any real research and there is no formalised process for
documenting any comparable sales analysis, or adjustment of market
opinion. They have gotten into the habit of informing the Vendor verbally
of their opinion and price adjustment.
Rickardo and Rosalind realise that if things do not improve that will have to
sack some of their staff. They are hopeful that as the market improves, things
will get better.
Rickardo’s has a policy and procedure manual that was developed about 5
years ago, but no one has had time to update it to include new requirements
in regards to under quoting and swimming pool legislation.
Recently Rickardo implemented a new KPI for the residential sales department
that requires all sales agents to get exclusive listings at a commission rate of
2.75% and Vendor paid advertising. (Previously advertising was included in the
commission rate and some agents are not comfortable asking for vendor
contribution for advertising).
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Part 1 – Risk Management
Activity 1 – Establish the context
a. Describe the core activities of the staff at Rickardo’s Realty.
b. What are the main objectives of the agency – what do they want to
achieve from their core activities, who are their stakeholders?
c. What are the main areas of risk in their day to day activities?
Type Answer Below
Customer’s satisfaction
Agency aims to achieve higher level of customer’s satisfaction by satisfying all their
needs. A stakeholder of the agency includes clients, employees, investors and
government.
Lack of expertise, less no. Of personnel
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Activity 2 – Identify and evaluate the risk
a. Using one of the identified risks that affects Rickardo’s Realty, explain
what can happen, how and why it can happen.
b. What is the likelihood of the risk happening?
c. What is the consequence if the risk happening?
Type Answer Below
Due to lack of personnel, one employee busy in NCAT will increase burden of responsibilities for
other people and also no one is there to handle the customer’s complaints. This problem occurs due
to lower company’s performance as an entity does not appoint true employees.
The likelihood of occurring of this problem is high which is affecting their financial as well as non-
financial performance.
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