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An underwhelming proportion of respondents to an industry survey believe property investment advice should be regulated.
The survey, conducted by The Adviser's sister publication SMSF Adviser, has revealed that of 469 respondents, 38.8 per cent felt no regulation is necessary while 61.2 per cent said they believe it should be regulated.
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Property Investment Professionals of Australia (PIPA) chair Ben Kingsley said industry is reluctant to support the regulation of property investment advice due to its hesitancy to take on more compliance burdens.
Mr Kingsley said the regulation of property investment advice would also discourage those who rely on commissions from kickbacks.
“In my reading of those numbers it is my view that, with so much compliance and regulation, there is no doubt that many people on the frontline are getting frustrated by the amount of paperwork that needs to be done and they know what is involved when you do bring in regulation,” he said.
“A lot of people will be thinking that if it’s unregulated, it’s just one area where they don’t have to do all that paperwork.
“The other reason is because there are people who make easy money on commissions and kickbacks and to remove that easy stream of referrals and income would obviously worry them.”
Mortgage broker, buyer’s agent and wHeregroup director Todd Hunter said the regulation of property investment has multiple benefits.
“It will take away two-tier marketing, it will take away the marketeers that are out there, it will make it a lot more difficult for hidden kickbacks and referral fees that are not disclosed and put a lot more transparency into the industry,” Mr Hunter said.
“I can’t advise you to buy a one cent share, but I can advise you to buy a $1 million property. In what world does that make sense?
“Property investment advice should definitely be regulated,” he said.
