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02 June 2013

Property agents keeping their nose clean

Fewer misdeeds since council set up to raise industry's standards, mete out punishment

Source: Sunday Times
By Hoe Pei Shan

Strict regulations and harsh penalties introduced with the establishment of the Council for Estate Agencies (CEA) are helping to clean up the real estate sector.

Latest figures show that seven people were charged in court for offences under the Estate Agents Act between October 2010, when the CEA was formed, and March this year.

Five of the seven have since been convicted and fined tens of thousands of dollars, with one serving a month in jail, in addition to a $32,000 fine.

They are among the 123 cases of alleged unregistered sales personnel and agents investigated by the council. Of these, 41 were issued warnings, while another 31 cases were closed with no further action taken as the allegations were not substantiated.

Investigations are ongoing for the remaining 44.

The CEA was set up to raise industry standards through regulation and enforcement under the Estate Agents Act, which governs the duties, business activities and conduct of about 1,500 licensed estate agents and some 32,000 registered sales executives.

Aside from sales personnel and agents without proper accreditation, the CEA can also investigate and prosecute other offenders of the Act.

The statutory board told The Sunday Times that it "will be prosecuting more persons for doing estate agency work without being registered over the next few months", but that it expects the number of such complaints to fall as awareness of the penalties grows.

Mountbatten MP Lim Biow Chuan, a member of the Government Parliamentary Committee on National Development and Environment, which covers housing, is also optimistic, noting that "strong enforcement measures and stiffer punishments are good deterrents".

"The steep punishments signal the seriousness of the offences, and agents have to ask themselves: Is this a risk they want to take?" said Mr Lim.

The largest fine dealt out to an unregistered agent so far was $40,000.

In mid-2009, the Government began studying ways to strengthen the regulatory framework of the real estate sector, which had been largely fragmented and self- regulating until then, following a rising number of complaints against agents.

"Before the CEA, anybody could just practise because there were no strict required qualifications for estate agents, nor was there a structured enforcement arm, so there were easily 30 to 40 per cent of us who did not have certifications," said Mr Shawn Tan, a managing director of a local property agency.

The council said overall complaints, most of which concern unprofessional or poor service, have fallen by 20 per cent from the average of five a day, from the period after the statutory board was formed, to an average of four a day this year.

Prosecution, in particular, has been very effective in "sending the right message", said C&H Properties key executive officer Albert Lu.

"The CEA has made examples of these errant agents and it has been good for the industry, bringing down the complaints and improving our image."

No holds barred

"Before the CEA, anybody could just practise because there were no strict required qualifications for estate agents... so there were easily 30 to 40 per cent of us who did not have certifications."

MR SHAWN TAN, managing director of a local property agency