Decision ris proposal for national licensing of the property occupations

Table G.16: Number of existing strata managing agents

Assumption	Unit	Value	Source
Total number of licensees – strata managing agents
NSW	# licensees	1,423	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. Note that this figure is only used to estimate the number of licensees in other states. There is no impact on strata managing agents in NSW
ACT	# licensees	16	To be included
NT	# licensees	10	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. Calculated by multiplying the total number of real estate licensees (510) by the average percentage of strata managing agents within the total number of real estate agent licensees in NSW and Victoria (5.74%).

Table G.17: Number of auctioneers (agents only)

Assumption	Unit	Value	Source
Number of licensees – auctioneers – agents
NSW	# licensees	1,810	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are agents (rather than representatives) has been estimated based on the proportion of agents to total licensees in NSW.
Vic	# licensees	944	Calculated by multiplying the total number of real estate agent licensees by the percentage of licensees who are auctioneers in NSW, Qld, SA and NT.
Qld	# licensees	1,137	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are agents (rather than representatives) has been estimated based on the proportion of agents to total licensees in Qld.
WA	# licensees	395	Calculated by multiplying the total number of real estate agent licensees by the percentage of licensees who are auctioneers in NSW, Qld, SA and NT.
SA	# licensees	336	Unpublished data provided by SA in June 2012 SA advised there are 799 auctioneer licensees and 58% are representatives. Hence, it is assumed that 42% are agents.
Tas	# licensees	38	Calculated by multiplying the total number of real estate agent licensees by the percentage of licensees who are auctioneers in NSW, Qld, SA and NT.
ACT	# licensees	89	Calculated by multiplying the total number of real estate agent licensees by the percentage of licensees who are auctioneers in NSW, Qld, SA and NT.
NT	# licensees	107	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are agents (rather than representatives) has been estimated based on the proportion of agents to total licensees in NT.

Table G.18: Number of auctioneers (agent’s representatives or sales representatives)

Assumption	Unit	Value	Source
Number of licensees – auctioneers – agent’s representatives or sales agent’s representatives
NSW	# licensees	1,621	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are representatives has been estimated based on the proportion of agent’s representatives to total licensees in NSW.
Vic	# licensees	1,246	Calculated by multiplying the total number of property agent’s representatives by the percentage of representatives who are auctioneers in NSW, Qld, SA and NT.
Qld	# licensees	889	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are representatives has been estimated based on the proportion of agent’s representatives to total licensees in Qld.
WA	# licensees	1,241	Calculated by multiplying the total number of property agent’s representatives by the percentage of representatives who are auctioneers in NSW, Qld, SA and NT.
SA	# licensees	463	Unpublished data provided by SA in June 2012. SA advised that there are 799 auctioneer licensees and 58% are representatives.
ACT	# licensees	96	Calculated by multiplying the total number of property agent’s representatives by the percentage of representatives who are auctioneers in NSW, Qld, SA and NT.
NT	# licensees	82	Unpublished data provided by COAG National Licensing Taskforce, Property occupations – licence policy development paper, Table 5, p. 11, received May 2011. The proportion of auctioneers who are representatives has been estimated based on the proportion of agent’s representatives to total licensees in NT.

Frequency of renewal of licence

Table G.19: Current frequency of renewal – for property licences

Assumption	Unit	Value	Source__Fee_differential_between_renewal_and_new_licences'>Source
Current frequency of renewal (i.e. licence period)
NSW	years	1	NSW Fair Trading 2011, Property, stock and business agents fees
Vic	years	1	Victorian Business Licensing Authority 2011, Estate agents
Qld	years	3	Qld Department of Justice and Attorney General 2011, Licensing register
WA	years	3	WA Real Estate and Business Agents 2011, Licensing fees
SA	years	1	SA Office of Consumer and Business Affairs 2011, Land agent
Tas	years	Perpetual	Real Estate Institute of Tasmania 2011
ACT	years	1	ACT Government, Justice and Community Safety, Forms and fees
NT	years	1	NT Department of Justice 2011, Real estate licences

Time cost of applying for a licence

The time costs shown in Table G.20 are based on regulator estimates or provided by the Productivity Commission.¹²⁶ Those costs provided by the Productivity Commission are in turn based on regulator cost estimates for registering a real estate agency, including obtaining information and forms, completing and lodging forms, paying fees and attending interviews (if applicable) in the relevant jurisdiction.

Table G.20: Time cost of applying for a real estate agent’s licence (individual and company)

Assumptions	Unit	Value	Source
Time cost of applying for a licence – all licences
NSW	Hours per licensee	0.32 hours (19 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
Vic	Hours per licensee	6 hours (360 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
Qld	Hours per licensee	2 hours (120 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
WA	Hours per licensee	2.65 hours (19 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
SA	Hours per licensee	0.25 hours (15 minutes)	Based on an estimate provided by the SA regulator in June 2012.
Tas	Hours per licensee	1 hour (60 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
NT	Hours per licensee	1.33 hours (80 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151.
ACT	Hours per licensee	1.67 hours (100 minutes)	Productivity Commission 2008, Performance benchmarking of Australian business regulation: cost of business registrations, pp. 147–151

Time cost of renewing a licence

It is assumed that renewing a licence is less onerous than applying for a new licence. A proxy based on the estimated effort to government (as illustrated by the renewal/new fee differential) has been used for illustrative purposes. The figures below are used to reduce the time component associated with applying for a licence. For example, in New South Wales it is assumed that it takes 13 minutes (68 per cent of 19 minutes) to renew a licence.

Table G.21: Percentage of new licence costs incurred on renewal

Assumption	Unit	Value	Source
Fee differential between renewal and new licences
NSW	%	68%	Based on licence fee data – renewal fee over new licence fee for a real estate agent
Vic	%	59%	Based on licence fee data – renewal fee over new licence fee for an estate agent
Qld	%	35%	Based on licence fee data – renewal fee over new licence fee for real estate agents
WA	%	47%	Based on licence fee data – renewal fee over new licence fee for a real estate agent
SA	%	58%	Based on licence fee data – renewal fee over new licence fee for a land agent
Tas	%	67%	Based on licence fee data – renewal fee over new licence fee for a real estate agent
ACT	%	56%	New and renewal fees are the same, which would lead to 100%. As this is a proxy for applying to time, this percentage has been based on the average of all other jurisdictions where the percentage is not 100%.
NT	%	56%	New and renewal fees are the same, which would lead to 100%. As this is a proxy for applying to time, this percentage has been based on the average of all other jurisdictions where the percentage is not 100%.

Transition costs for industry

Under national licensing, transition costs would be imposed on industry. Specifically, licensees would need to understand the changes and how they are affected. Time costs would be incurred by reading material, attending an information seminar or through some other means. It is assumed that this cost is incurred before the implementation of national licensing in 2012–13.

In the Consultation RIS, it was assumed that each licensee would require 45 minutes to understand the changes, however consultation feedback indicated that more time would be needed to understand the changes and a 90 minute timeframe has now been included for this purpose.

Table G.22: Industry transition costs

Assumption	Unit	Value	Source
Industry transition costs (time to understand national licensing)
Time	Hours per licensee	1.5 hours	An assumption of 90 minutes per licensee

Mutual recognition

Case studies provided by – and discussions with – the COAG National Licensing Taskforce suggest that in some cases the time to obtain mutual recognition can far exceed the time to obtain a licence for those residing in a given jurisdiction. This reflects additional search costs and potential delays associated with gaining mutual recognition. For that reason, this analysis assumed that obtaining a mutual recognition takes twice the time taken to obtain a licence for those residing in a jurisdiction.

Table G.23: Time cost associated with obtaining mutual recognition licence, multiplication factor

Assumptions	Unit	Value	Source
Time cost to apply for a new licence under mutual recognition
Property services	Multiplication factor	2	Assumption based on information provided by the COAG National Licensing Taskforce and from jurisdictional regulators.

South Australia and the Australian Capital Territory have indicated that it would typically take less time for a licensee to renew such a licence compared with the time that would be taken if the licensee resided in their own jurisdiction. However, case studies provided by – and discussions with – the COAG National Licensing Taskforce suggest that licence applications are more onerous under mutual recognition. For that reason, this analysis has assumed that renewing a mutual recognition licence takes 5 per cent more time than the time taken to renew a licence for those residing in a jurisdiction (over and above the time to apply for a licence – see Table G.20).