Tuesday, September 29, 2009

Industry suggests licensing of property agents

Just like drivers, some suggest property agents should be licensed by a government body – and subject to a demerit point system too.

That would mean being allowed to a set number of points, before facing possible suspension for misconduct.

Such ideas were floated by industry players yesterday at a forum organised by the Institute of Estate Agents (IEA), as the Ministry of National Development (MND) began this month its consultation process on a new regulatory framework for the real estate sector.

Complaints of agents’ poor service are rising and customers are now more discerning and demanding, so such regulations will be necessary to keep the standards of the profession up to mark, said IEA president Jeff Foo.

National Development Minister Mah Bow Tan had said in March that the whole system was “not satisfactory” and the status quo “not tenable”, after several cases of unethical practices by housing agents came to light.

The framework, suggested HSR International Realtors chief executive officer Patrick Liew, should include mandating minimum hours of training and certification to improve professionalism.

An official mediation and complaints resolution centre – sorely lacking now – should also be set up, he said at the forum.

According to the Consumers Association of Singapore, of the 1,100 complaints received last year about the real estate industry, more than half (635) concerned agents.

About 500 complaints have been made as of July this year, and the eventual total is expected to match or exceed last year’s.

But while licensing and certification would help to give consumers peace of mind, a demerit point system has its limitations in weeding out rogue agents, said PropNex property consultant Joseph Tan.

“They can still do unethical things so long as they don’t hit the limit for demerit points,” he said.

There was also a concern about possible additional costs that might come with licensing, said IEA’s Mr Foo. But going by fees paid elsewhere, for example, about HK$700 (S$128) a year in Hong Kong, the “average agent” should have no problems paying, he said.

Property consultant and Ngee Ann Polytechnic real estate lecturer Nicholas Mak said regulations will need to be closely enforced for them to have bite.

“And the punishment has to be sufficient … If someone stands to gain S$100,000 by misrepresenting a property, and the punishment is only a S$5,000 fine, then he might consider it a risk worth taking,” he said.

Source: Channel News Asia, 29 Sep 2009

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