Real estate agents bill: a done deal?

Last night Parliament passed the Real Estate Agents Bill, sweeping away the old and seriously ineffective self-regulatory regime operated by the Real Estate Institute of New Zealand.

When the new Act comes into force in 14 months or so, consumers who feel ripped off will be able to claim up to $100,000 in compensation against agents from an independent Disciplinary Tribunal. At little cost. At the moment, agents may be fined up to $750. Which the Institute can keep if they want.

As the Herald put it last year:,

“The institute, as much as agents on the ground, ought to wear much of the blame for the Government’s intervention. It has regarded its duty of self-regulation for the industry as about just one of those two words, self.”

Associate Justice Minister Clayton Cosgrove claimed that around $1 million was spent on a highly sophisticated lobbying campaign to stop the bill. The REINZ President:

“…refused to comment on Mr Cosgrove’s accusation that REINZ had spent $1 million lobbying against the law, engaging top Wellington advocate Mai Chen. But he said he was disillusioned with some MPs. “It’s disappointing that people who said they would support us didn’t.”

I wonder who he was talking about. The Nats voted against the Bill, saying property managers should be covered by its provisions. They also say, “at the end of the day the consumer will not have more protection than under existing legislation.” Bizzare.

What the Herald doesn’t mention in this morning’s report is that Cosgrove has also claimed that the REINZ president told a Palmerston North gathering that the bill would not pass until after the election and that the Institute expected the National Party to make changes in the industry’s favour.

So, a victory for the consumer — for the moment — and an end to a system of self-regulation so ineffective that it is widely mocked as it dies a well-deserved death.

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