Mon, 16 Nov 2009 4:10p.m.
Real estate agents will be under a thicker magnifying glass as the newly established Real Estate Agents Authority begins operations tomorrow.
Among the many changes, the REAA will allow property buyers and sellers to look up industry licensees on a public register. The system will outline when they were first licensed, or whether they've had any disciplinary action against them in the last three years.
All are designed "to promote public confidence in the industry," said Kristy McDonald QC, chairwoman of the REAA.
The REAA is a crown entity regulating real estate agents, branch managers and salespersons under the Real Estate Agents Act 2008 and takes over from the Real Estate Institute of New Zealand (REINZ) as the regulatory body of the industry.
REINZ, which will now become a membership service, welcomes the new Act and sees it as a positive move, said national president Peter McDonald.
" It's an opportunity for the real estate industry to lift its public perception."
The Act was introduced by Labour MP Clayton Cosgrove as the associate minister of justice last year and was one of the last pieces of legislation passed by the previous government.
Mr Cosgove said the new Act "aims to promote and protect the interests of consumers in real estate transactions by raising industry standards, improving licensing requirements and procedures and providing mandatory disclosure obligations".
The change was made over concerns that the previous regime was self-regulatory, said Ms McDonald.
"There wasn't an independent complaints and disciplinary process. There was concern about a lack of information for consumers and inadequate mechanism to raise industry standards.
"The Real Estate Agents Authority will provide independent oversight of the real estate industry, " she said.
Under the new authority, agents, branch managers and salespersons require to be licensed individually.
Anyone who holds a licence, prior to November 17, will be deemed to be licensed under the new Act until their licence expires.
The REAA will also be responsible for complaints, disciplinary action, and providing information for consumers. An independent Real Estate Agents Disciplinary Tribunal that will look at serious matters of misconduct has been established, and the appointment of Complaints Assessment Committees by the REAA will be introduced.
The tribunal could order cancellations of licences and award up to $100,000 in compensation.
Real estate agents will have new responsibilities, such as providing more information to consumers and they are no longer required to be members of the Real Estate Institute of New Zealand (REINZ).
"There is also a compulsory code of conduct and client care, which sets standards of practice and identifies the standards to be maintained by the members of the real estate industry," said Ms McDonald.
There have been changes on penalties as well. Before the maximum penalty for an individual was $750 and for a company $2000. That has been increased to up to $10,000 for an individual and up to $20,000 for a company.
Ms McDonald said the REAA was enthusiastic about the change and confident about the processes in place. The only short-term challenge could be a large number of industry complaints starting tomorrow.
NZPA