KEY POINTS:
Real estate agents are lining up in their hundreds to defend their turf against a new bill that overhauls the industry in a crackdown on rogue agents.
The justice and electoral select committee expects to hear between 700 and 800 oral submissions on the Real Estate Agents Bill,
mostly from real estate agents.
It is almost eight times the 101 oral submissions on the Electoral Finance Bill and double the 350 heard on the Foreshore and Seabed Bill.
As well as boosting penalties, the bill creates a new independent Real Estate Agents Authority to take over licensing, complaints and disciplinary processes within the industry.
The new system will replace the current self-regulating regime run by the Real Estate Institute of New Zealand (REINZ), which all of New Zealand's 1800 real estate agents are members of.
Many of those submitting yesterday agreed with parts of the bill, especially the need to tighten complaints and discipline processes. But almost all said it went too far and would add to costs as well as put the industry in the hands of people who had little experience.
The institute is fighting the bill, which follows Associate Justice Minister Clayton Cosgrove's vow to crack down on "land sharks" after concerns that complaints dealt with by the self-regulated industry were buried and punishments were too small.
The Real Estate Institute is due to present its submission next week and has also taken on public law specialist Mai Chen, who helped with its 400-page submission and was at the hearing listening to the submitters yesterday.
But evidence that it has mobilised its troops was clear at yesterday's hearing as agent after agent said the plan was bureaucratic and would lead to higher costs for consumers.
Yesterday Mr Cosgrove told the Herald he was not surprised at the large number of submitters but it was clear the institute had put its network to good use mustering its troops.
"Obviously the REINZ has gone to a lot of expense and work. There is compulsory membership of the institution. Its members tell me they've done a lot of lobbying of the industry and that's okay, it's a democracy. I'm sure they will make an interesting contribution.
"It's interesting the vast majority are from the real estate industry themselves, because there is no 'grumpy and ripped off consumers' association.
"I don't apologise for sticking up for consumers who have been done over."'
He said he was "relaxed" about the process and any recommendations made and was expecting a wide range of opinions among agents themselves.
Feelings were high among some submitters before the select committee - one speaking via video conference walked out in protest after reading out a short statement complaining about the lack of democratic process because his 14 staff were not also permitted to make individual submissions.
While many submitters agreed an overhaul of the 1976 legislation was needed and supported harsher penalties, they predicted the new authority would result in higher costs which would be passed on to consumers.
WHAT THEY SAID
* Tommy Heptinstall, of Tommy's Real Estate, said the bill was "total hysteria" and "total overkill" which punished honest agents for the sins of few "rogues". The firm supported an independent complaints procedure but said compulsory membership of REINZ should remain because of its role in training, gathering statistics to inform the market, and representing the industry as a whole. Tommy's also wanted rental property managers brought under the same rule, arguing there were "far more opportunities for misappropriation of funds in letting than in property sales".
* Gary Stewart, a commercial and business broker, said the bill made wholesale, costly changes for the sake of change. He said "tightening" was needed in areas, including "rogue" agents and disciplinary processes. However, he said it could have happened within the existing system.
