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Commercial agents who sell property such as shops and offices are alarmed by a proposal from the Commonwealth to allow these transactions without a real estate licence.

Under a plan for national licensing being promoted by the Council of Australian Governments (COAG), the Steering Committee behind the plans is proposing to abolish the license for commercial real estate agents altogether.

The COAG taskforce has held information sessions around Australia to discuss the proposals with those in the industry.

Chairman of the Real Estate Institute of Western Australia’s Commercial Network, Mr Victor Sankey, said the proposal was very concerning and would allow ‘cowboys’ to enter the industry with little or no knowledge of real estate law or consumer rights.

“This push seems to be based on the mythology that most commercial transactions in property are multi-million dollar deals done by experienced legal firms on behalf of the big retail chains, but this isn’t so,” Mr Sankey said.

Mr Sankey said that the majority of commercial transactions were suburban shops, offices, warehouses and leasing spaces for small business, not the big end of town.

“Consumers are very concerned at the prospect of commercial sales taking place by people who have no understanding of the many and varied laws that apply to such transactions, including the rules around foreign investment, legislation covering contaminated sites, strata titles law, GST implications and more,” Mr Sankey said.

President of the Real Institute of Australia, Ms Pamela Bennett said that doing away with a professional licence for commercial agents across Australia would be bad for the industry and would make consumers vulnerable to inexperienced sales people with no qualifications.

Ms Bennett said, “Commercial real estate transactions were often complex and could produce unexpected issues during the settlement period and it makes no sense to abolish licensing.”

“Both the sellers and buyers need to be assured that the selling agent is appropriately trained and qualified,” she said.

Victor Sankey agreed. “Commercial agents require more skills and qualifications than residential property agents because this area of work is much more diverse and complex. The legislative complexities in the commercial sector are extensive and the personal indemnity risks to agents are huge.”

Mr Sankey said that insurers are insisting commercial agents have more skills these days in order to get cover and that reducing qualification requirements would be disastrous for the industry and the public.

The COAG Taskforce information sessions have also covered proposed national licensing for electricians, plumbers, gasfitters and air conditioning. Feedback from the sessions has been supportive of proposed licensing changes for electricians, plumbers and gasfitters, but not so for real estate agents and air conditioning.

Mr Sankey said including the real estate profession with a range of trades was a mistake and should be removed from the COAG plan.

“You cannot compare the working environment and legislative regime of a real estate agent with a plumber and then expect a national licensing scheme to apply uniformly across these industries. They are chalk and cheese,” Mr Sankey said.    

Congratulations to Daniel Coulson - the 2012 Real Estate Institutes’ Australasian Auctioneering Champion.

Real Estate Institute of Australia (REIA) President Ms Pamela Bennett says, “At just 22 years of age, Daniel is the competition’s youngest ever winner and continues New Zealand’s domination of the Championships over the past several years.”

Coulson took out the title after a tight contest between five outstanding auctioneers.  The other finalists were Michael Fenn (SA), Ben Brady (QLD), Andrew North (NZ) and Rob Mason (WA).

The Australasian Auctioneering Championships, this year hosted by the Real Estate Institute of South Australia (REISA), test an auctioneer’s skill and ability to command a crowd, manage any issues at the auction and call complex bidding offers.

“Judges decided on a winner after the finalists were briefed on a new property to mock-sell under the hammer.   The property used was mixed commercial and residential land, the bidding was fast and furious and there was even a medical emergency to contend with during each auctioneer’s frantic 15 minutes on stage. It was very exciting and highly entertaining,” says Ms Bennett.

Open to the public, the annual Australasian Auctioneering Championships host 21 auctions over two days. The quality is truly exceptional with participants creating momentum in the bidding, while building rapport with the crowd.

The Australasian Real Estate Institutes' Auctioneering Championships were first held in 1993 and provide a significant opportunity for REIA and the Real Estate Institute of New Zealand (REINZ) to show off their very best Auctioneers.

“REINZ has set the bar very high over the past years.  REIA looks forward to gaining back some ground at next year’s Championships in Perth,” concluded Ms Bennett.

An independent survey has shown strong public support for the Real Estate Institute of Australia’s (REIA) position on national licensing.

“REIA has been concerned about the dumbing down of the profession under the Council of Australian Governments’ (COAG) national licensing proposal,” said REIA President Ms Pamela Bennett.

In August, COAG released its Regulation Impact Statement (RIS) on national licensing for the real estate profession.  REIA supports the proposal of national licensing in principle but has been highlighting the flaws contained within the RIS.    

“We want high standards for the profession including Diploma level qualifications, compulsory professional development (CPD) and the licensing of commercial property transactions so as to provide consumers with protection throughout all their property transactions.  Dumb down these standards and the consumer will suffer.”

UMR Research conducted a nation-wide survey of 1000 respondents, asking four questions about the professional standing of licensed agents, the appropriate level of qualifications, the need for continuing professional development and the need for licensing on commercial property transactions.

“The results indicate that:  a majority of respondents view agents as members of a profession (52%) rather than members of a trade (11%); there is majority support (48%) for a Diploma qualification rather than a Certificate IV level (36%); overwhelming support (82%) for continuing professional development and; strong support (69%) for commercial property agents to be licensed,” added Ms Bennett.

“Lowering of the bar for real estate agents would have a detrimental impact on consumer protection.   It’s very encouraging that the general public, the clients of the real estate profession, agree with the stance taken by REIA.”

“The proposal by the Government is clearly out of step with the expectations of the Australian public,” concluded Ms Bennett.

UMR Research survey and state/territory breakdown available at http://reia.com.au/real-estate-media-release.php

Following an Exciting Opening Ceremony program, the Keynote Speaker, world-renowned Economist Hernando de Soto, President of the Institute for Liberty and Democray, presented his views and thoughts to a room overflowing with close to 1,000 World Congress participants. His pioneering work on behalf of property rights for the poor have led to global acclaim and recognition. de Soto is known for his revolutionary thinking and his focus on the relationship between property rights and economic development. de Soto's speech, "Property Rights and Political Rights: The Way Forward," focused on the concept that the lack of formal property rights is the source of poverty in many countries. This, in turn, has caused a direct effect on the global economic environment that presently exists.

Click here to hear Hernando de Soto's Key Note Speech.

Or visit the FIABCI website for more.