Recent media reports have given the impression there is still debate over whether commercial real estate agents should be licensed under the new National Occupational Licensing Scheme.
That’s not the case. This debate is now settled.
A special committee established by the National Occupational Licensing Authority (NOLA), representing all stakeholders, has unanimously agreed that commercial agency work will be included in the new national licence for real estate agents, subject to two exceptions.
The first exception is that agents managing on behalf of ‘related entities’ would not require a licence; the second exception is that ‘sophisticated property owners’, that is those large owners who fully understand the risks involved in commercial property transactions, would also not be required to use a licensed agent.
This means only a very small fraction of commercial transactions could be undertaken by unlicensed agents, and all transactions involving ‘small’ commercial property owners would involve licensed agents.
The committee also resolved concerns about personal probity requirements for licensees.
There should therefore now be no obstacles to introducing the national real estate licence.
Demands by the Real Estate Institute of Australia (REIA) – a party to the compromise above – for compulsory professional development for real estate agents around Australia and for diploma level qualifications for all real estate agents (currently only 20% of agents have such qualifications) could then be pursued with NOLA, once the national licence is operating.
Since these demands will impose at least $55 million a year in additional costs on the real estate industry, it is not unreasonable to require thorough investigation and justification by the relevant authorities before such a considerable cost burden is placed on the industry, particularly given all Australian governments are now committed to removing job-destroying cost burdens on businesses.
Milton Cockburn is executive director of the Shopping Centre Council of Australia.