Real Estate Reforms Inadequate

Posted in Foreclosure, Real Estate, July 12th, 2007 |

The opinion of the Real Estate Institute is that all those who are somehow or the other connected with the real estate business should be brought under the measures being undertaken to give the industry a shakeup and a new look to it. Thus under its purview should come property managers, agents involved in letting and leasing as well as companies which take fees and not only those who takes commission for property sale.

In May the Government came forth with proposals to reform the real estate industry. It planned to set up an independent body, which would have powers to investigate. The underlying idea was to give protection to customers. The Government was forced to take the step after coming in for a dose of strong criticism for not doing anything tough and firm to rope in offenders and protect the hapless victims.

The President of the Real Estate Institute, Murray Cleland released the submission sent to the Government agreeing with most of the proposals including the setting up of a Real Estate Agent’s Authority. It was also in agreement about the authority being made responsible for entertaining complaints and taking disciplinary action, together with extending the remedial measures and available sanctions. The recommendation was to increase the maximum fine to $30,000 in line with payments made to lawyers and to those who made the conveyances, raising the eligibility standards and seeing to it that it remained so. The rules should also extend to issues regarding disclosure of conflicting interests.

Mr. Cleland argued that the reforms would not be effective if anybody was left out of the chain – especially those who were potential risks to the borrowers like property managers, letting and leasing agents and companies who charged fees rather than commission to clinch the deal. Unfortunately the Government has till date kept these elements out of the regulatory zone, including only real estate agents and sales personnel. But the harsh fact is that one out of every five complaints is against these very people. Mr. Cleland added that the institute was concerned about the extra costs that the setting up of new establishment would involve. Therefore the industry should be consulted about levies and other similar fees that may be imposed. Most members opined that the industry continued to focus on setting industry specific educational standards and also provide information to the consumers.

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