For some time, Leverage has been discussing the proposed reforms to the Property, Stock and Business Agents Act 2002. Many have asked us if they are real or only discussion. On the 21st of November 2017, Matt Kean, Minister for Fair Trading, issued a press release giving no doubt that the reforms are a reality:
Link Not available any longer at – https://www.finance.nsw.gov.au/about-us/media-releases/new-real-estate-reforms-better-protect-consumers? utm_campaign=What’s+New+24+November+2017&utm_medium=email&utm_source=General+Customers
Whether these reforms are good or bad is no longer the issue. The industry, which includes consumers, will need to get on board with the new regime. We thought that the legislative amendments in 2003 were wide covering but the industry is in for a shock. The legislation that Minister Kean refers to will have a greater impact on the operations of agents than ever before.
Kean has demonstrated by the proposed reforms that the government no longer considers business as a priority. They have done this by placing increased pressures on the costs of real estate agents and small family businesses by these amendments. They have also abolished the Business Agents License. This is on the premise that business people do not need protection when selling their business asset. This is consumer legislation and only to protect consumers. If we didn’t already know it, the government is not about small business and the entities that employ two thirds of the Australian population.
The amendments will also affect how you establish a business. By abolishing the corporation license, how you conduct your business and tax affairs will be altered greatly. As a replacement for the corporation’s license, one person will be the licensee in charge of each office. That person will become completely liable for all mistakes within the office. This additionally will change what asset protections the licensee in charge will need to consider when building a business. Again, business is the loser.
The legislation will change:
- The way you manage your human resources;
- Your agency agreements;
- Your compliance regimes;
- Your training regimes; and
- Your insurance requirements.
Many have talked about the legislation as being the importance of these reforms. Unfortunately, the evil is often unseen. The changes to your business are in what is not written but what the written word creates.
These changes will have a greater impact on business, those working in the industry and those wanting to enter. Whether they are good or bad is not the issue. They are here and you will need to adapt your business to find a way to do business and to make money.
This article was written by Bailey Compton, Principal Solicitor & Director at Leverage Group.
To get in touch with Bailey, please email firstname.lastname@example.org or call 1300 438 538