AGENTS FACE JAIL UNDER NEW LAWS
New laws to protect SA consumers upset many agents.
Something is happening in South Australia that shouldn't make sense.
For years, the state's real estate chiefs have loudly proclaimed that agents in South Australia are not like those scoundrels in the East. All that dirty stuff such as dummy bidding, false quoting, bait pricing, insider trading, well, none of that goes on.
South Australian agents are lily-white and look out anyone who says anything else.
In 2002, when Neil Jenman said the real estate industry in South Australia was "rotten to the core", the President of the Real Estate Institute told ABC Radio, "If Mr Jenman's got any evidence, he should give it to the state regulators or the Attorney-General. They'll take care of it."
In 2003, when Jenman presented his consumer seminar in Adelaide, one agent had to be ejected for yelling abuse. The drunken agent was using the famous Aussie swear word (the one that relates to cattle).
Meanwhile, a South Australian Labor MP was working tirelessly behind-the-scenes with his own independent inquiry into the industry. His name was John Rau and his inquiry was prompted by a distressed constituent, one of the thousands of consumers whose opinions of agents differed from agents' opinions of agents.
After a lengthy investigation, John Rau presented evidence to the Attorney-General. His report recommended sweeping changes which, if implemented, would give South Australians some of the best real estate consumer protection in the country.
The biggest obstacle to real estate consumer protection in any state is, of course, the real estate industry.
For decades, agents and their spokesmen have not only managed to deceive consumers, they have also managed, quite successfully, to pull the wool over the eyes of politicians and regulators. As institute presidents often say, "We have worked with the government over the years to look after consumers."
But John Rau was one politician they couldn't fool. The South Australian government is now on the verge of introducing some wonderful reforms to protect consumers.
Predictably, the real estate industry is outraged. The current President of the Real Estate Institute, Robin Turner, is still battling hard to protect agents. Last week, Turner said the reforms could spell "the death of the auction system".
The government, however, is saying that the new laws will "ensure lawful and ethical behaviour in the industry".
So what are the reforms that are so upsetting South Australia's lily-white real estate agents?
Here they are – no more dummy bidding; no more false quotes to sellers; no more bait pricing to buyers; disclosure of all cosy deals with financial advisers, conveyancers and mortgage brokers and no more insider trading where agents or their mates buy homes from sellers at cheap prices. Finally, the ultimate king-hit, no more misleading and deceptive conduct.
The State Government has even taken the unprecedented step of threatening offending agents with jail terms. "Shape up, or else," is the clear message.
Although agents are fuming, the government, to its credit, seems to be resisting the pressure to protect agents at the expense of protecting consumers. Last week, Acting Consumer Affairs Minister, Paul Holloway said, "The Government does not apologise for protecting South Australian homebuyers." Nor should it.
If these reforms go ahead, the South Australian Government will have done a magnificent job on behalf of consumers.
And Labor MP, John Rau will have done exactly what all politicians are sworn to do – protect the community from scoundrels.
But, hang on. Haven't we forgotten something?
The Real Estate Institute has been saying for years that agents in South Australia are not like agents in other states. According to the much touted old line, "There is no evidence to support allegations of deceit and dirty dealing in South Australia."
So why are agents objecting to new laws that ban deceit and dirty deals?
It doesn't make sense.
FOOTNOTE:The South Australian reforms can be viewed by clicking here.
If you wish to comment on the reforms, you must do so before September 3.
To send a comment to the South Australian Government regulators, please click here.
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