After conducting an appraisal of the property, you estimate the selling price at $400,000-$440,000. Dominic and Tina are happy with this and ask you to go ahead and list the house for sale.

Additional details:

Address of property - 263 Bell Street, Coburg

Continuing Authority - 60 days from the end of the exclusive authority period

Chattels included in the sale - All fixed floor coverings, drapes, blinds and fixed electric light fittings

Terms of sale - 10% deposit on signing and the balance in 60 days

Vendor's asking price - $400,000

Agent's estimated price range - $400,000 to $440,000

Agent's fees including GST - 3.3% of the selling price

Marketing expenses including GST - Advertising $1,000

Consider the following situations and issues. Explain what is wrong for each situation as well as legal and/or ethical requirements in relation to property sales. You must refer to relevant legislation to help answer these.

• You are approached by a potential buyer who wants to buy the property, tear down the house, build two units and lease them.He offers $390,000 and says that if you can get the vendor to accept this price, he will use your agency to sell the developed properties and on top of your standard commission I'll pay a $10,000 bonus commission for each property sold for getting this sale together at $390,000. What are the possible consequences if you were to agree to the buyer's proposal because of a number of factors including your estimate is $400,000 to $440,000?
• You are approached by a potential buyer who wants to buy the property, tear down the house, build two units and lease them.He offers $390,000 and tells you that if you can get the vendor to accept this price, he will use your agency to manage the properties. What are the possible consequences if you were to agree to the buyer's proposal?
• You have also been approached by another potential buyer who makes an offer of $400,000.You believe that the house will sell for more at auction so you do not pass on the offer to the vendors. At auction, the property is passed in as it does not make the reserved price.

in the state of Victoria Australia