Residential Property Managers Bill - Will Not Progress

It was announced in April 2024 that the Government will not proceed with plans to regulate residential property managers.

This announcement was met with disappointment by many in the residential property management industry, not least by the Real Estate Institute of New Zealand (REINZ), who have campaigned for regulation since 2019.

The Bill would have imposed minimum safeguards and protections on an unregulated industry that manages billions of dollars in assets for everyday New Zealanders.

Currently there is no requirement for residential property management offices to hold rental monies in a trust account, or to have insurance, and there is no requirement for residential property managers to undergo any form of training.

The concern is that any individual can set up a residential property management business without abiding by any specific industry regulations, and therefore there is little protection for landlords and tenants.

Whilst we are disappointed with the Government's decision, Harcourts offices are ‘self-regulating’, with our offices and residential property managers already delivering most of what was proposed in the regulations.

For example, below is a summary of the proposals, with comments about what we are already delivering:

• Requiring RPMOs (Residential Property Management Offices) to have insurance of a specified kind and to a specified level of cover; Harcourts offices are required to hold a minimum level of Professional Indemnity Insurance.
• Requiring RPMOs to establish and use trust accounts in the prescribed manner; Harcourts offices are required to hold all rental funds in trust accounts.
• Prescribing records that must be kept by RPMOs; Harcourts offices are required to use specialised residential property management trust accounting software that maintains secure records of both financial transactions and all other records attributed to managing residential property.
• Providing for the appointment of auditors and for auditing requirements, including the power of inspection of trust accounts and other documents or records that are necessary or desirable for carrying out an audit; Harcourts offices are required to have their trust account either independently reviewed or audited at least annually.

The regulations were also set to prescribe minimum entry requirements for residential property managers and continuing professional development requirements.

At Harcourts, new property managers are fully supported in their training and development with entry level and advanced training and support, alongside the opportunity to attend a series of world class events.

Lee Grigg, Kim Clark and Rochelle Topless all have completed the Residential Property Management Qualification (Level 4) and Kim Ioane is making her way through the training.

Harcourts property managers do not have to look far to find the support, training and information they need to be successful in their role.

So, while we are disappointed that the overall standard of professionalism for our industry will not increase due to a regulatory regime, we will continue to stand apart from other property management businesses and consistently deliver excellent service. Our rigorous self-regulation standards ensure we will continue to offer greater protection for our clients.