Home.co.uk
Home.co.uk

News: NZ Real estate industry slammed

Mon, 16 Apr 07

The Real Estate Institute - which referred none of the 132 complaints it received in 2004 to its licensing board - is facing a major overhaul, reports the NZ Herald...

Clayton Cosgrove is scathing about the organisation, which in 2005 referred only seven of the 163 complaints it got to the disciplinary board - a panel that can expel agents by taking away their licence to practice.

Mr Cosgrove criticised many aspects of the institute, saying consumers had little confidence in the industry. He observed:

“The freedom of self-regulation granted by the Real Estate Agents Act 1976 was perceived as industry protectionism rather than giving the consumer safeguards”.

Agents welcome changes

The Real Estate Institute has hired high-profile lawyer Mai Chen, who said yesterday:

“Agents welcome the change and have wanted the law updated for many years, seeking higher fines and a more transparent system”.

Institute president Murray Cleland said agents were delighted with the changes:

"No one has a bigger interest in ensuring public confidence in the industry and in the industry's reputation than do we. We will be happy to co-operate with the Government in securing the necessary legislative change to ensure this”.

He continued: “We have been doing a lot of work off our own initiative, including the appointment earlier this month of consumers advocate David Russell to chair a review of our code of ethics to raise standards, but the existing act is an impediment to structural change.

But Chris Taylor, head of real estate agency The Joneses - which promises a flat fee of $7995 to sell a house regardless of the asking price - complained bitterly about the institute yesterday and said he welcomed sweeping changes:

“My firm was compelled to be an institute member, yet the very same institute was taking action against The Joneses for breaching a code of ethics that barred it from criticising other agents in public”.

Spark for change

Deb Leask, whose complaints about the system were partly the spark for the changes, praised the overhaul:

"I am happy Mr Cosgrove has taken the situation on board and had the Ministry of Justice officials look into different ways to improve the system. I agree that agents should not investigate other agents. Complaints should be dealt with by an independent body".

She concluded: “An overhaul will ensure that the consumers are protected from real estate agents who could take advantage of them. There will also be more accountability on agents to do the right thing, or they will be without their livelihood."

Back to: News Index