Interest in real estate gig spikes

The number of people applying to become a real estate agent has increased 42 per cent during Covid-19, surprising the Real Estate Authority (REA).

At the same time, the industry watchdog and Crown entity has expressed concern that New Zealand’s real estate qualifications are not fit for purpose and warns that an Australian loophole ‘‘undermines’’ professionalism in the industry.

An REA briefing paper prepared for Associate Minister of Justice Aupito William Sio, who has oversight of the REA and Real Estate Agents Act, said as at September 30, there were nearly

15,200 active licensees (salespersons, branch managers and agents) including

601 new licensee applications from July to September, an increase of 42 per cent on last year.

‘‘This was above our forecast that licensee numbers would reduce in response to the Covid-19 conditions,’’ the paper said.

However, there were also a number of suspended licensees and the REA expected overall licence numbers were likely to reduce to 14,500.

The increase in new applicants comes at a time of house price inflation, another phenomenon the REA did not predict during the pandemic.

In the 2020 financial year, the REA received 288 complaints about real estate licensees.

From July to September complaint inquiries and complaints to the REA increased 26 per cent and 13 per cent respectively, albeit off a record low base.

Ensuring New Zealand’s qualifications suite for agents was fit for purpose was key to ensuring high standards of knowledge and professionalism in the sector, the REA said.

A review was under way to ensure that a robust minimum standard for training was established, it said.

Issues relating to qualifications were two-fold, it said.

First, Australian training organisations were providing New Zealanders with real estate agent qualifications after 12 weeks’ training, regardless of a person’s experience, compared to the New Zealand equivalent which took 24 months.

The Australian qualifications did not cover relevant New Zealand legislation or REA regulations, it said.

However, that licence must be recognised in New Zealand under the Trans-Tasman Mutual Recognition Act.

‘‘In our view, the qualification is not fit for purpose for the New Zealand real estate industry and enables new licensees to enter the New Zealand real estate sector without adequate experience and training.’’

The increased use of Australian qualifications undermined the level of quality, knowledge and experience of some licensees in New Zealand and was affecting the overall professionalism of the real estate industry, it said.

A growing number of licensees were choosing to complete the shorter Australian qualification to bypass the New Zealand qualification, it said.

The REA said it was working with the real estate industry, training organisations, the Ministry of Justice and the New Zealand Qualifications Authority to address this as a priority.