Decision ris proposal for national licensing of the property occupations

Preferred national licensing model

The first part of this chapter provides a high-level overview of the preferred national licensing option and proposed model. The model draws on consultations and input from stakeholders, evidence and impact analysis. The second part contains a detailed description of each element, and the rationale for the preferred approach to each element, including relevant consultation feedback. The draft Amendment Bill and regulations have been based on this model.

During the development of the national licence model for the property occupations, a risk-based approach was taken based on identified consumer and health and safety risks associated with property work. An overview of these risks can be found in Attachment F. The Council of Australian Government’s (COAG) best practice regulation principles were also considered.

3.Licence categories

A licence category identifies the scope of regulated work, which describes the extent of work authorised under the category. The proposed national licence model for property occupations is based on a number of licence categories, each relating to specific aspects of property work.

The licence categories proposed for the property occupations are listed below in Table 3.1.

Table 3.1: Proposed licence categories for the property occupations

Licence categories
Real estate agent licence
Business agent licence
Strata managing agent licence
Agent’s representative registration
Real estate auctioneer licence

The categories divide some of the existing broader current jurisdictional categories. For example, the current Victorian estate agent’s licence will be separated into three licence categories: a real estate agent’s licence, a business agent’s licence and an auctioneer’s licence. It is expected that all three categories could be provided on a single licence document. There will also be a change to some elements of the licensing or registration arrangements of strata managing agents in the Australian Capital Territory and the Northern Territory.

A small number of current licence categories were not considered a strong enough risk or demand to warrant a separate licence category – for example, residential property managers and buyer’s agents. Some of the existing categories have been encompassed in the scope of a real estate agent and an agent’s representative. The rationale and stakeholder feedback for some of these arrangements is discussed later in this chapter.

Table 3.2 illustrates categories where national licensing will occur across Australia. It should be noted that, in accordance with clause 4.2(f) of the Intergovernmental Agreement for a National Licensing System for Specified Occupations (the Intergovernmental Agreement), a jurisdiction will not be required to adopt a national licence category where it does not regulate the area of work at the time national licensing commences. These instances are indicated by the blank sections of the table.

Table 3.2: Proposed national licensing categories across jurisdictions

	NSW	Vic	Qld	WA	SA	Tas	ACT	NT
Real estate agent	y	y	y	y	y	y	y	y
Business agent	y	y	y	y	y	y	y	y
Strata managing agent	y	*					y**	y
Agent’s representative	y	y	y	y	y	***	y	y
Real estate auctioneer	y	y	y	y	y	y	y	y

* The registration of owners’ corporation manager will remain a state-based licence in Victoria and will not be included in national licensing. However, for fullness of information for decision makers, the cost of implementing a strata manager’s (owners’ corporations) licence is included in the estimated costs for Victoria. See Chapter 4 for impact analysis.

** The Australian Capital Territory is yet to determine whether a national licence will be issued for strata managers.

*** Tasmania has indicated that it may adopt the national licensing agent’s representative registration.

A comparative mapping of national licensing categories and arrangements against each of the current jurisdictional categories and arrangements is provided in Attachment A.

The following subsections provide a synopsis of the licence categories and the relevant regulated work. A rationale and evaluation on each of the elements follows later in this chapter.

Real estate agent

Regulated work means work that may be carried out only by a person licensed to carry out that work, i.e. the type of work authorised under that licence. The regulated work for a real estate agent includes certain non-residential property transactions, also called commercial agency work. Views expressed in the public consultations and submissions were strongly supportive of the inclusion of this work in the scope of work of real estate agents, agent’s representatives and auctioneers. See discussion later in this chapter.

The scope of regulated work for a real estate agent is described below in Table 3.3. Under national licensing, an individual and a body corporate will be able to apply for a real estate agent’s licence.

Table 3.3: Policy description of the proposed regulated work for a real estate agent

Licence category

Preferred regulated work

Real estate agent

Real estate agency work means selling, purchasing, exchanging, leasing, managing or otherwise dealing with real property on behalf of another person, for fee, gain or other reward. However, the following work is not real estate agency work : Strata-managing agency work; or selling, purchasing, exchanging, leasing, managing or otherwise dealing with real property that: is not rural land; and is used or intended to be used, wholly for purposes other than residential property; and has an estimated contract price of at least a prescribed amount or has an area greater than a prescribed area. Estimated contract price, for selling, purchasing, exchanging, leasing, managing or otherwise dealing with real property, means the true estimate, made on reasonable grounds by the person carrying out the work, of the price payable for the real property transaction. Rural land means land used or apparently intended to be used, for gain or profit, for grazing livestock or cultivating crops.

Business agent

The scope of regulated work for a business agent is described below in Table 3.4. Under national licensing, an individual and a body corporate will be able to apply for a business agent’s licence. See discussion later in this chapter.

Table 3.4: Licence category and proposed regulated work for a business agent

Licence category	Preferred regulated work
Business agent	Business agency work means the selling, purchasing , exchanging or otherwise dealing with a business on behalf of another person, for fee, gain or other reward.

Strata managing agent

The scope of regulated work for a strata managing agent is described below in Table 3.5. Under national licensing, an individual and a body corporate will be able to apply for a strata managing agent’s licence. See discussion later in this chapter.

Table 3.5: Licence category, proposed regulated work and associated definition for a strata-managing agent

Licence category

Preferred regulated work and associated definitions

Strata managing agent

Strata managing agency work means managing, for a fee, gain or other reward, any function of an owners’ corporation on behalf of an owners’ corporation under a strata or community title scheme. Strata or community title scheme, for a participating jurisdiction, means a scheme that has been declared by a law of that jurisdiction to be a strata or community title scheme for that jurisdiction for the purposes of the National Law. Owners corporation includes a body corporate under a strata or community title scheme.

Agent’s representative

The scope of regulated work for an agent’s representative is described below in Table 3.6. The registration for an agent’s representative is a change to the current arrangements for agent’s representative in Victoria. See discussion later in this chapter.

Under national licensing, an agent’s representative is not authorised to operate a business and therefore the registration will only be available for individuals.

Table 3.6: Registration category and proposed regulated work for agents’ representative

Registration category	Preferred regulated work
Agent’s representative	Agent’s representative work means real estate agency work or business agency work carried out as an employee of, or otherwise for or by arrangement, with a person who holds a real estate agent’s licence or business agent’s licence; and Under the supervision of the person who holds the real estate agent’s licence or business agent’s licence.

Real estate auctioneer

The regulated work for an auctioneer of real property is described below in Table 3.7 and includes the auctioning of non-residential property. Under national licensing, an auctioneer is not authorised to operate an agency and therefore the licence will only be available for individuals. See discussion later in this chapter.

Table 3.7: Licence category and proposed regulated work for a real estate auctioneer

Licence category	Preferred regulated work
Real estate auctioneer	Real estate auctioneering work means the auctioning of real property on behalf of another person, for fee, gain or other reward.