Calling for consistency

How is it that real estate licensing requirements can vary so significantly from state to state, when the job is relatively the same? And what should be done about it? Tony Rowe, from BPG Training, says that it is time to focus beyond the parochial rivalries, and adopt a broader, national view.

How is it that real estate licensing requirements can vary so significantly from state to state, when the job is relatively the same? And what should be done about it? Tony Rowe, from BPG Training, says that it is time to focus beyond the parochial rivalries, and adopt a broader, national view.

Across all States and Territories: Building codes vary significantly (but ours is best). Vehicle registration rules and fees vary (but ours is best). School terms are three or four terms (but ours is the best system). School curriculum requirements are different (but ours is best). Auctioneer requirements differ (but ours is the most ethical / efficient / regulated / compliant).

The ‘Henny Penny syndrome’ is alive and well with the current debate over the introduction of a national licensing system for the real estate sector in Australia. If the change is allowed, the sky will fall and the industry will collapse!

Interstate rivalries are useful up to a point for sporting contests, but perhaps a more balanced and national approach is required in this instance. The actual processes for the purchase, sale, leasing, and management of property across the country are virtually the same.

Each State and or Territory will (and does) argue that their “system” is better / best / more rigorous / compliant / efficient than any other jurisdiction, and that adopting anything different means a “lowering of standards”. This is patently untrue.

COAG have announced that a National Occupational Licensing System (NOLS) will be introduced across a range of professions. The real estate industry is just one of the targeted sectors, and for the property sector, this will occur on 1 July 2012. The purpose of national licensing is to eliminate overlapping and inconsistent regulation between the different jurisdictions. It aims to improve business efficiency and the competitiveness of the national economy, reduce red tape, improve mobility, and improve productivity.

The awareness of issues around cross-border operations in the real estate industry has been recognised for a long time, for those agents who already operate in 2 or more jurisdictions – for example Tweed Heads and Coolangatta agents, or those in Albury and Wodonga, or in Queanbeyan and ACT. Commercial agents operating across States and Territories are required to maintain (and pay individually for) multiple licenses in order to operate their businesses in different jurisdictions.

The differences in actual processes are small and insignificant; the similarities are many. The problem is obvious to most – there are eight different sets of legislation governing the way the industry operates, setting eight different types of “minimum educational requirements”. This feeds a misconception that one State or Territory does things better than the next.

The State and Territory based institutes have not been able to reach a consensus about what the NOLS should look like. COAG and the regulators consulted widely with a variety of industry stakeholders, and have finally decided to act. That decision has ended several years of procrastination. The consultation has considered the views of sometimes competing groups who “represent” the same agents – regulators, franchise groups, institutes, industry associations, and training providers (whether public, private, franchise group, institutes and industry association). The dialogue is continuing.

The Federal Government is expected to release, for a further round of consultation, a Regulation Impact Statement (RIS) on National Licensing for property professions sometime in July. Victoria passed the model legislation in September last year. This will be the basis upon which the other States and Territories delegate power for issuing licenses to the national body.

Some of the “players” have now started to issue press releases of the Henny Penny variety – because they have not been able to “get their own way” in consultations to date. Since they have been unable to agree with each other, their capacity to influence the workings and decisions of COAG has been limited.

There is a ‘misinformation’ campaign being conducted ahead of the release of the RIS. There is (or should be) some degree of responsibility, or accountability, required by those currently making ill-founded statements. As it is at present, they are besmirching the reputations of agents in other States and Territories, industry regulators locally and in other states, other industry groups involved in the discussions to date, and training providers across the country – with what should only be seen as “false and misleading information”, for their own commercial gain.

Some industry bodies are better than others at representing the interests of their members. Some even try to represent themselves as, and usurp the role of, the “regulator” for their jurisdiction. Some have been known to try to attempt to bully their members, non-members, regulators, and even ministers – with varying degrees of success.

The Institutes are now separately trying to influence the outcome of that consultation, but again, have not reached agreement amongst themselves about what it is they want.

Constantly repeating a mantra of “mine is better than yours” is not the way to work out what is right for the industry as a whole, across the country. State and Territory based loyalties have a role in the sporting arena, but not in the creation of an efficient, viable, national business environment in an economy the size of Australia’s.

It is time to focus beyond the petty, parochial view, and adopt a broader, national view. Industry associations have a role to play in providing a service to their members. They also have a responsibility to provide a balanced and honest view. Franchise groups, commercial agencies, regulators, and training providers have a role to play as well.

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Tony Rowe

Tony Rowe is the CEO of TT Rowe and Co, a compliance, education and training consultancy providing specialist advice to the property industry in Australia.