NSW’s under-quoting and over-promising Real Estate agents should be quaking in their pointy shoes this week with the announcement that the state government is planning to appoint a Property Services Commissioner and is stepping up its efforts to stamp out dodgy dealings in the sales, purchase and rentals of homes.
Strata managers and building managers who are more focused on fleecing their clients than advising and supporting them, may also be wondering if and when theFair Trading hit squads will come a-knocking.
In the last two week-long blitzes alone, NSW Fair Trading issued 137 Penalty Infringement Notices and 224 warnings, with fines totaling $150,710. Whether or not that carries a sufficient fear factor in an industry where prices are out of control is a whole other issue.
The appointment of a Property Services Commissioner follows the success of Building Commissioner David Chandler in shaping up the apartment building industry by enforcing existing restrictions on build qualities.
Whether a Properties Commissioner can have the same galvanizing effect depends very much on the powers she or he is given.
The fact that Chandler’s team can withhold occupancy certificates for sub-standard buildings carries a lot of weight in the industry, as that could very easily send dodgy developers to the wall when they can’t finalise the sale of apartments and have to return deposits.
The sanctions available to curb the worst excesses of real estate and property operatives may be less terrifying.
But Minister for Better Regulation and Innovation Kevin Anderson said the new commissioner is the next step in the NSW Government’s commitment to supporting the property and real estate sector while restoring public confidence in the industry and the regulator.
“I am determined to properly support the property services industry which employs over 37,000 people and contributes $100 billion to the NSW economy,” Mr Anderson said in a press release this week.
“We are taking the same successful approach we did for the building and construction sector with the appointment of the Building Commissioner. We want to see a well respected industry expert take the lead and make the case for reform, while actively supporting consumers and ensuring best practice, modern regulation of the property sector.”
The Commissioner will join the Property Services Expert Panel – a professionals-only committee of strata managers, building managers, and real estate and holiday rentals agents.
There are no representatives of apartment owners, residents or tenants on the Panel, despite Fair Trading’s claims that this is all about consumer protection.
Mr Anderson says the Commissioner will be responsible for ensuring a strong, vibrant property sector, which is responsive to the needs of property services professionals and ensures the highest compliance and professional standards for the benefits of consumers.
“Consumer protection is at the forefront of our agenda and we know the property sector supports this objective as well,” Mr Anderson said.The NSW Government is currently finalising the recruitment process which is expected to commence later this month.
However, with the real estate sector booming across NSW, Mr Anderson said Fair Trading inspectors were already out in force to ensure agents were complying with legislation intended to protect consumers. And dodgy agents could be fined up to $22,000 for failure to comply with the Property Stock and Business Agents Act.
To be clear, the average penalties in the recent “blitz” have been only $1100 – a far cry from the $22,000 maximum cited. But at least the intention is headed in the right direction.
“Buying, selling or renting a home is a massive financial decision for consumers which is why we have strong legislation and a fiercely independent regulator to ensure real estate agents are conducting themselves appropriately,” Mr Anderson said.
“Our inspectors have been out visiting agencies, auctions and open homes across the state to make sure agents are doing the right thing and fining those who aren’t.”
He said the latest checks uncovered myriad examples of non-compliance. “We will continue to conduct these blitzes until the industry pulls its socks up.”
“We are the only state in Australia to carry out regular real estate compliance blitzes and that is due to the NSW Government’s commitment to protect consumers,” Mr Anderson said.
“This is exactly what NSW Fair Trading is here to do – make sure businesses are following the rules with the goal of protecting the interests of consumers both buying and selling properties.”
To find out more about underquoting under the Property, Stock and Business Agents Act, visit https://www.fairtrading.nsw.gov.au/about-fair-trading/legislation-and-publications/changes-to-legislation/underquoting-reforms.
FYI, no strata manager has ever lost their licence in NSW just for being really, really crap at their job, regardless of the financial and personal costs to their clients. Perhaps the new Property Commissioner can add remedying that to their “to do” list.
You can see Minister Anderson and Building Commissioner David Chandler in person at an Owners Corporation Network seminar next month. For full details, click here.