A Government minister has rejected taking any immediate action on property manager regulation, saying more work needs to be done on the issue and spelling out how the Government has better things to do.
Kris Faafoi, Associate Housing Minister, rebuffed a call from 41 real estate entities and businesses to overhaul the rogue property management sector saying there were important things to do.
"In this term, the Government considers other priorities in the area of housing policy require more immediate attention," he said in response to the rally led by the Real Estate Institute and its chief executive Bindi Norwell.
While he welcomed REINZ's push, he indicated that was flawed because not enough work had been done on what form regulation would take.
"More detailed investigation around regulation of the property management sector could be useful but it would not be feasible to try to advance proposed legislation before next year's election that could be properly thought through and adequately consulted on.
"This is not a simple issue and there are differences of opinion on who should be covered under regulation. It's important that, if changes were to be made, that they are worked through carefully and with consultation," he said.
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Last week, 40 organisations including Barfoot & Thompson, Consumer, Harcourts and the Salvation Army, joined REINZ to lean on the Government although one sector boss. Norwell yesterday released the names of businesses and organisations backing regulation and said the time was right for change.
"As planning is underway for the 2020 election, REINZ is today calling on the Government to formally review the need to regulate the property management industry, including public consultation, and to announce its recommendations for reform before the 2020 election," her statement said.
The sector has been dogged by issues lately including major loss of funds from Harcourts after trouble with its youngest franchisee, Gurpreet Grewal whose operations included property management.
His Preet & Co Real Estate had an estimated a $5.2m shortfall, including bank debt of more than $1m and $1.7m owed to Harcourts Group. Accounts for property manager Preet & Co Rentals estimated a $1.6m shortfall partly from $1.2m owed in bank debt and more than $150,000 owed to Harcourts Group.
And last year, creditors were claiming $733,000 from a West Auckland property management business that previously traded under the Ray White banner. David Sharma's Property Management Out West of Henderson has no assets yet unsecured creditors want $733,247, a liquidator reported then.
Housing Minister Megan Woods referred REINZ call to Faafoi.
Despite Faafoi's brush off, Norwell expressed satisfaction with Faafoi's response and played down his lack of enthusiasm for action before next year's election.
"We are not calling on advancing proposed legislation before next year's election. We are calling on the Government to conduct a review with formal public consultation and ideally have a recommendation on what the Government proposes before the next election," she said today.
She backs his call for more work to be done on the issue and provided new information on why the reform is needed.
"We agree that it needs thorough consultation and consideration to determine the best approach for different segment, for example, property manager, landlords," Norwell said.
Green Party co-leader Marama Davidson, Renters United and Tenants Protection Association backed REINZ.
David Pearse, Property Managers Institute president, said REINZ was acting in self-interest because many property managers were attached to licensed real estate divisions. People in those businesses were in REINZ, he said.
READ REINZ full document here: