FPA stands firm on real estate reform
The Financial Planning Association (FPA) is sticking to its position that real estate agents should be regulated by a separate regime that picks up the best elements of Financial Services Reform (FSR), despite the release of a report last week recommending that agents be regulated under the legislation as it currently stands.
The report, tabled in the Senate last Friday by the Joint Committee on Corporations and Financial Services inquiry into regulation of property investment advice, recommended that property be considered as a separate asset class under FSR.
A carve-out would apply for real estate agents who inform investors of past and present values of property. Agents making predictions of future values or income streams from property, however, would be required to hold an Australian Financial Services License, be PS 146 compliant, and provide disclosure documents similar to statements of advice.
The recommendation was based on 26 submissions both supporting and opposing further regulation of the property industry received from a series of relevant stakeholders including the FPA, Australian Competition and Consumer Commission, the Real Estate Institute of Australia, the National Institute of Accountants, property developer Mirvac and the Australian College of Financial Services.
While FPA chief executive Kerrie Kelly today released a statement expressing support for a new national regime to regulate property investment advice, the association is maintaining the proposals tabled in the Senate last Friday had gone too far by simply re-applying existing legislation.
“We actually argued in our submission that property investment advice be covered an FSR-like regime, picking up the most important aspects of FSR,” said FPA policy and government relations manager John Anning.
“We’ll be putting the report to our regulation committee for discussion and we’re developing an FPA commission on the report.”
Anning said the FPA committee would meet in a fortnight.
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