•MODULE:

ETHICAL STANDARDS
FOR REAL ESTATE
MANAGEMENT
PRACTICE
 MODULE DESCRIPTION
• This course is designed to help develop
and refine the real estate practitioner's
decision-making skills from an ethical
standpoint. Using factual and hypothetical
case studies, group discussions,
workshops, and videos, participants will
study various real estate ethical codes to
acquire the tools and strategies to
maintain strict ethical standards.
 LEARNING OUTCOMES
• After successful completion of this module,
the student should be able to:
* Gain a definition of ethics.
* Acquire an explanation on traditional
sources for motivating ethical behavior.
* Knowledge on the sources available
for help in making ethical decisions.
 LEARNING OUTCOMES
• After successful completion of this module,
the student should be able to know:
* Standards of professional conduct
when carrying out real estate agency
work
* The meaning of best practice in a real
estate industry context
* The meaning of ethics in a real estate
industry context
 Code of Ethics
and Responsibilities
for
Real Estate Service
Practitioners
 Who are the Real Estate
Practitioners?
• Real Estate Consultant
• Real Estate Appraiser
• Real Estate Assessors

• Real Estate Brokers

• Real Estate Salespersons
 Realty Service Practice
a profession, calling or
occupation is dedicated to the
promotion, development
including proper zonification
and conservation of land &
natural resources, including
 improvement, rights,
interest appurtenant thereto
for the benefit & enjoyment
of the Filipino people you
serve.
Declaration of Principles
a) The realty service practice is a
noble profession, calling or
occupation and those engaged
therein shall abide by and
comply with all the laws,
decrees, orders and rules and
regulations enacted or
b). Utmost fidelity, sincerity,
respect for colleagues in the
profession & honesty shall be
observed at all times by those in
the realty service practice in
relation with the client, the
community & the nation in
c). Adequate knowledge,
competence and expertise in
real estate development and
management shall be
maintained; and upgrading of
the standards of practice shall
be effected when the needs
arises; all these for and in the
d). The spirit of camaraderie,
cooperation and professional
relationship by respecting the
rights of every practitioners
shall be promoted;
e). A high level of professional
respects with colleagues, in the
realty service practice shall be
maintained and the dealings
with each other shall always be
fair, honest and just;
f). The Golden Rule which reads
“ Treat others as you like them
to treat you” shall be observed
in all dealings and relation of
the practitioners with clients,
fellow practitioners, the
organization to which you
 Categories in the Rules of
Conduct
a. In relation to the
Government
b. In relation to the General
Public
c. In relation to Client
d. In relation to Fellow
In Relation to the
Government
(a) The Practitioner shall
always set a good example as
a responsible law-abiding
citizen.
 In Relation to the
Government
(b) The Practitioner shall
secure all necessary licenses,
permits and authority as
may be required by law,
ordinance or rules and
regulations.
In Relation to the
Government
(c) The Practitioner shall pay
correct taxes and fees required
by law. They shall not
encourage, tolerate or
participate, directly or
indirectly, in the evasion or
illegal reduction of any
 In Relation to the
Public
(a) The Practitioner shall

contribute to the promotion of

the common good by engaging

in social responsibility

activities and initiatives.

In Relation to the Public
(b) The Practitioner shall
cooperate with the government
and the AIPO in protecting the
public against fraud,
misrepresentation and unethical
practices of licensed, unlicensed
and unauthorized individuals or
In Relation to the
Public
(c) The Practitioner shall enhance
his/her competency, proficiency
and expertise in the practice by
keeping abreast of the latest trends
and developments in the field of
real estate service through the
involvement in Continuing
 In Relation to the
Public
(d) The Practitioner shall
participate in the proactive
development of real estate
service by imparting knowledge,
technical training, experiences,
studies or research, except those
that are deemed classified or
confidential which may only be
disclosed upon the consent of the
parties concerned or lawful order
You should keep your self well
informed as to any movement
affecting real estate in the
community, city or province, so that
you may be able to contribute to
public thinking on matters of
taxation, land use, city planning,
zonification & other purpose of the
You should cooperate with
the government in
protecting the public against
deceptive, unfair and
unconscionable or
misleading acts & practices
Or unlicensed ( COLORUM )
practitioners like fraud,
misrepresentation,
concealment of relevant
information and other
related unethical practices.
 In Relation to the Accredited and
Inteqrated Professional
Orqanization (AIPO)
(a) The Practitioner shall support
the AIPO by actively participating
in its programs and activities.
 In Relation to the Accredited and
Inteqrated Professional Orqanization
(AIPO)
(b) The Practitioner shall abide by
the procedures on mediation,
conciliation and arbitration of
grievances and disputes. A
Practitioner who is a party to any such
grievances or disputes shall, as far as
practicable, exhaust all possible
administrative remedies within the
context of the AIPO Bylaws before
elevating the same to the jurisdiction
 In Relation to the Accredited and
Inteqrated Professional Orqanization
(AIPO)

In the interest of society and your

own profession, calling or
occupation, the practitioner should
abide by the constitution and by-laws
of your association or organization
and the national association to which
it is affiliated.
2. You should support your
organization morally and
financially and actively
support its plans, programs
and projects for the benefit of
the members of the
3. Any practitioner should
first exhaust all
administrative remedies
available under existing
laws, rules and regulations
before taking any judicial or
quasi-judicial action.
MODULE ASSESSMENT.
MULTIPLE CHOICE
Choose the correct answer:

1. If the owner wants to undervalue the sale

price, the real estate broker is expected to
tell the owner:

a) To undervalue not lower than zonal value

b) To get a contact with the BIR
c) To have 2 deeds of sale
d) The true basis of capital gains tax
2. Funds which come into the
hands of the real estate broker
from the client should be, under
the Code of Ethics:

a) Placed in a separate bank

account
b) Deposited in the broker’s
account
c) Just put in the wallet of the
3. An accredited real estate
salesperson must be under the
supervision of the real estate
broker and should indicate:

a) Name and license number of

the broker
b) Email address of the broker
c) The website of the broker
d) Name and field of
4. As part of the obligation under
the code of ethics, the broker
must, as much as possible, see to
it that the agreements are:

a) Notarized
b) In writing
c) In triplicate copies
d) Not required to be in writing
5. In accepting an appointment or
authority to act for and in behalf of a
client or costumer, the broker should
pledge himself with utmost fidelity
and good faith to protect and
promote the interest of his client
which means:

a) Loyalty to the client

b) Be loyal to the client at all costs
c) Be only working to the advantage of
the client
6.For violation of the code of
ethics, the following penalty may
be imposed by the broker’s
professional real estate
organization:

a) Removal of license
b) Suspension of license
c) Removal from roster of
registered real estate brokers
 7. Which of the following acts can be
considered to be unethical for a real estate
broker?
a) The broker should cooperate with other
brokers on property listed
b) The broker should share the commission
on an agreed basis
c) The broker should seek no unfair
advantage over his fellow brokers
d) The broker can use the services of the
salesman of another broker provided he
pays the salesperson a commission
8. A 2 storey house and lot was being
rented out by the owner and listed it
through several brokers. A broker who also
obtained the listing can place his for rent
sign if authorized by the owner and only if:

a) It does not exceed two signs for rent

b) It is placed not less than 2 meters away
from the other sign
c) His sign is not more than 2 meters by 2
meters in size
d) There is no sign placed on the property
9. Several offers for the purchase of the property
were submitted by the real estate broker to the
owner and then another offers to purchase was
received by the real estate broker. What should
the real estate broker do?

a) Wait for the owner to decide first before giving

the latest offer
b) Tell the purchaser that his offer will have to wait
till owner decides
c) The latest offer should be presented to the
owner for his decision
d) The real estate broker should tell the buyer to
revise his offer
10. In his brochures, advertisements,
or announcements, the real estate
broker should present a true picture
of the property and is not required to
indicate the following:

a) Rights or interests over the

property
b) Liens or encumbrances on the
property
c) Name and firm name
11. In accordance with RESA Law, a
Code of Ethics shall be prepared by
the ______ and adopted for
observance by all real estate service
practitioners:

a. Accredited Integrated Professional

Organization
b. Professional Regulation
Commission
c. All existing real estate service
associations
12. Prior to the final approval of the
new Code of Ethics under RESA Law,
the following has been considered
applicable:

a. The Golden Rule

b. The Code of Ethics of each realty
association
c. No code of ethics
d. National code of ethics for realty
service (DTI)
13. The “Golden Rule” is a
universal guide which means:

a. Treat others as you like them

to treat you
b. Do unto others as they do unto
you
c. An eye for an eye
d. Treat others as if they are your
family
14. The Rules of Conduct and
practice in the Realty Code of Ethics
defines the practitioner’s relations to
the following, except:

a. His family, relatives and close

friends
b. Clients/costumers and fellow
practitioners
c. His organization and the national
association to which it belongs
d. Government and the public
16. Which of the following is
not needed by the real estate
service practitioner before
practicing?

a. Mayor’s Permit with LGU

b. BIR Certificate of Registration
c. Professional tax receipt from
LGU
d. Professional I.D. and license
16. The relative of a prospective
Buyer was the one who referred the
Buyer and is asking you as a broker to
over-price the property offered. Your
response shall be:

a. Report the relative’s request of

over-pricing to the Buyer
b. Refuse it outright at the risk of
losing the sale
c. Cancel the transaction
d. Offer the relative a share of your
17. A broker who holds a non-exclusive authority
to sell writes letters to several real estate
organizations offering all their members an
extension listing, then informing his client that he
has extended his listing to several real estate
associations. His action can be interpreted as:

a. A sign of his desire to please his Client and

expedite the sale
b. A sign of his generosity because he is offering an
extension of his listing to large groups
c. A strategy to pre-empt many other brokers
from applying for accreditation with the owner
d. All of the above
18. A real estate broker who just
closed the sale for his Client may
agree to do the following, except:

a. Rebate part of his commission to

the buyer’s wife without his
knowledge
b. Process the documents needed to
transfer the title for an extra
facilitation fee
c. Prepare the deed of sale
d. Assist the buyer to negotiate a
19. A broker receives several offers to
buy for one of the properties in his
list. He should:

a. Show the Client all the offers

b. Show the Client the offer made by a
prospective buyer who is his distant
relative
c. Show the Client only the highest
offer
d. Show other Offerors the highest
20. A seller’s broker receives several
offers for a property, none of them
equal to or higher than the Seller’s
asking price. He should:

a. All of the above actions are alright

b. Show the owner all the offers for his
decision
c. Start negotiating with the highest
offeror to increase his price
d. Start negotiating with the owner to
reduce the price