Real estate reforms do not go far enough, says Institute

Everyone engaged in real estate should be covered by measures reforming the industry, the Real Estate Institute says.
That included property managers, letting and leasing agents and companies which charged a marketing fee rather than a commission for the sale of property, it said.
In May the Government announced proposals to shake up the industry, including setting up an independent body with investigative powers to better protect consumers. The shake-up came after criticism of the industry for failing to take a tough lines on complaints.
Real Estate Institute president Murray Cleland yesterday released the institute's submission on the proposed reforms, saying it supported most of the Government's proposals including the establishment of a Real Estate Agents Authority.
It also backed:
* The transfer to the authority of responsibility for disciplinary and complaints procedures;
* Extension of the range of remedies and sanctions available;
* Increasing the maximum fine - it recommended raising it to $30,000 in line with that for lawyers and conveyancers;
* Raising entry standards to the industry and ensuring standards remained high with a requirement for compulsory continuing professional development;
* Extending the rules relating to disclosure of conflicts of interest.
But Mr Cleland said that if regulation was to be effective it needed to cover everyone involved in real estate "who posed a potential risk to consumers including property managers, letting and leasing agents and companies which charge a marketing fee rather than a commission for the sale of property".
The Government was not proposing to bring these groups into the regulatory regime on the same basis as real estate agents and sales people, he said.
"Yet one in five complaints to the institute concerns letting, leasing and property management and there is no difference in principle between charging marketing fees and charging commissions."
Mr Cleland also said the institute was concerned additional costs incurred in establishing the new authority were kept in check and said the industry should be consulted on any levies or fees imposed.
Members felt the industry should continue to be responsible for setting educational and industry standards and for the provision of consumer information.