Property Hub - Investment Insights & Inspiration - Realty Talk Vault: Doing Deals Differently

Episode Date: May 3, 2023

We bring you another classic Realty Talk episode from the vault, which was originally published on October 22, 2022, but is still just as relevant today. As many locations shift from a seller’s to a buyer’s market, what does this mean to your negotiation approach at this opportune time? Australia’s number one property negotiator Scott Aggett from Hello Haus returns to unpack how you need to do deals differently. RealtyTalk is part of the Property Hub podcast channel, your home for property investment insights, inspiration, and stories from Australia’s top property experts, investors, leaders, and analysts. Subscribe now to get every RealtyTalk episode delivered to you each week for free, and also get full access to Get Invested, the leading podcast for Australians who want to unlock their full ‘self, health, and wealth’ potential and get inspired by the stories of investors, founders, and entrepreneurs. Subscribe to RealtyTalk on the Property Hub channel: Apple Podcasts | Spotify | Google Podcasts | Email Property Hub is a collaboration between Bushy Martin from KnowHow Property, Kevin Turner from Realty, Andrew Montesi from Apiro Marketing and Apiro Media, and Australia’s largest independent podcast network DM Media.  Business and partnership enquiries: [e-mail] omnystudio.com/listener for privacy information.

Hi and welcome. Now, unfortunately, the history of the property industry has been plagued by slippery shoe salespeople and spruikers who suck people in to overpay for poor properties that invariably underperform. Like wolves in sheep's clothing who present convincing arguments by cleverly packaging truisms that sound plausible, but don't ultimately pass the sniff test. So how can you separate the sheep from the goats and engage your team of independent professionals who operate with integrity and honesty and have your best interests at heart, not their own hidden agendas? The answer, PIPA, the Property Investment Professionals of Australia, where membership demands that professionals across the full spectrum of property strategists,

buyers agents, finance brokers, and others uphold a very strict code of conduct. However, some PIPA members who've been operating as imposters as they fail to uphold the high professional standards or falsely advertise their PIPA membership when they no longer actually have it are potentially misleading, unsuspecting investors. So to discuss PIPA's proactive approach to upholding and ensuring their professionalism in the industry, the chair of PIPA, Nicola McDougall, joins us again. So welcome back, Nicola. Thanks, Bush. And thank you for that intro. Apart from your astounding command of the English language, it is sad that every word that you were saying was true about uh the the myriad charlatans and spruikers out there but um that was

that was an amazing introduction thank you no thank you i think the the sad thing is that there's enough of those out there that that give the a bad name to the the other host of very professional operators in the industry who have been doing the right thing and continue to do the right thing so So, you know, I just admire the way PIPA is really setting the standards there. And I guess just to get into it then, Nicola, can you sort of summarize for us what is PIPA's key role in the industry as you see it? Yeah, so PIPA, we've been around for about 15 years now. You know, we're a non-profit industry association for anyone who is involved in the provision of property and investment advice. And the reason why PIPA was formed many years ago by, you know, the very best practitioners back in the day was the fact, you know, that the spruikers were such a huge part of the market and to provide some consumer protection.

That is because there isn't any regulation in this space because property is not seen as a financial instrument. So it was, OK, well, that's unfortunate that that's happening. obviously PIPA throughout the years have been lobbying federal governments to help to see if we can get some legislation in the space we haven't been successful I think it's all too hard for them so what we continue to do is we're a membership body where the very best most most ethical and professional practitioners choose to belong to the association they choose to abide by our code of conduct as a key plank of their membership of the association. And most of them also complete a qualified property investment advisor training program, which ensures they have that additional

level of education out there as well. All of these things obviously provide additional consumer protection out there and also raises the professional standards of everyone working in the industry. Yeah, brilliant. So just to give us a bit of a taste then, what are some of the key elements of pepper's code of conduct uh it's all it's all about the code of conduct is all about sort of fostering best practice by raising the standards uh within the industry facilitating proper professional development and market integrity the number one one though is really about um agreeing to disclose any commissions that may be paid to you uh in your sort of you know as a property investment professional um what's what's vital with that disclosure is you

know it's trying to creates transparency everything is out in the open um it's about everyone obviously knowing uh you know both sides of of the situation but spruikers they never do that right they will never ever they won't you will think they'll present themselves as operating on the buying side of the transaction but they're really operating on the selling side you're not buying a property you're being sold a property and what you don't know as a consumer um is that that they are getting paid a significant commission by a bunch of different people, let's be honest, to promote that property to you with the pretense that they are providing you with property investment advice. That's the way spruikers have operated forever. That's

how they continue to operate. So it's really that commitment to the disclosure of any commissions that might be paid paid and when i'm saying that i'm not talking about you know every type of commission but you know sometimes there are you know some commissions that are paid for referrals and things like that but it's just about being honest upfront and transparent about the process and and by our members by our members doing that it means that they are already you know far and away uh the the best girls and guys in the industry because they are prepared to to provide that information to every single client that chooses to work with them yeah it's spot on and eliminating yeah hidden and secret brown paper bags so that the investors know exactly who's

getting paid what and why really important and we're not that's exactly and at the end of the day you know our members are professionals who charge a fee for service for their service they deserve to be paid but generally they are they are paid that by their clients they work for their clients they provide independent bespoke tailored advice for that particular person for their individual circumstances so we're not saying you know the disclosure of commissions or payments is not about them not charging a professional fee for their services but it's just about setting the benchmark for transparency yeah it's spot on and the the old saying that uh uh nothing's there's no such thing as a free lunch you're paying for it somewhere is uh ever more true in the the

property sphere. So tell me, given that context then, Nicola, why is it important that investors check regularly who are PIPA members, do you think? Yeah, I think it's really important because we have had instances over the years where people have been saying that they're PIPA members and they never have been. They could be promoting it on their websites on LinkedIn, for example, but they actually never have been a member of PIPA. We've also had instances where people have done that where they are saying that they're qualified property investment advisors um when they're not um we have had instances where people have been um you know they no longer are members of PIPA um sometimes they've just not renewed uh their membership and but it's still you know

if you googled them it might look like that they're still PIPA members but they're not um and also you know our code of conduct you know is the backbone of the association and that means that we take consumer complaints about PIPA members very seriously. We have a legal risk committee which will go through a due process to handle that complaint and we have on occasion actually terminated members

who were seen through that process. It was found that they had contravened our code of conduct and their memberships have actually been terminated. So that's why it's vital. Like on the PIPA website, people can go there and check the membership status of anybody at that point in time and i would suggest that they they do that every year um because as i say just because someone was a

member last year doesn't mean that they're a member this year um and it's just vital that well in a way you know it's we are you know smallish non-profit industry association we do our very best uh to monitor this it would be great if consumers could actually pass on information to us if they do find that people are saying they're PIPA members or they're QPIAs and they're not because that is obviously you know saying that you're a PIPA member and you're not is against Australian consumer law um and we will follow that up but it is pretty impossible for us um to actually monitor monitor that all ourselves but especially it's about consumer protection it's about investors understanding whether someone is actually a PIPA member or they're not

year to year because you know most of our members are members for year on year year on year year on year but then we do have a cohort a very very small cohort who may not renew for a variety of reasons and we do have some whose memberships have actually been terminated. Yeah that's very important so the what are the approaches that PIPA is undertaking in to ensure that members are upholding the highest professional standards and Nicola well that's I mean it's on our website as well consumers are able to lodge complaints to PIPA if they have worked with the PIPA member sometimes we do get complaints from investors where the person is not a PIPA member so we aren't able to help them however we do do our very best to steer them in the right direction we do

have a lot of far more of them than we do PIPA members complaints against PIPA members sorry so but we do have that complaint handling process within PIPA and we do take it very seriously and our legal and risk committee follows a due process to investigate every complaint that may may be lodged by by by a consumer and then it'll it'll be taken to its natural well not as natural I suppose it's a conclusion but also there is appeals process as well from the member but I must say that this happens very few there's not many instances of that happening throughout my involvement in the eight years that I've been with PIPA because you know we only take complaints from consumers on PIPA members and they are very very few and far between. Yeah good to hear and

I really want to thank you for the great work that you and the the rest of the PIPA board are doing to really uphold the standards of professionalism in the industry. Nicola, and thanks again for your time on the show today. Thanks for having me, Bushy. Anytime. Thanks, Nicola. Well, there you have it. If you're looking for proven independent professionals to assist you on your property journey, you can find members on pippa.asn.au, of which we're proud members and strong supporters. So keep watching the Property Hub's Realty Talk, your trusted voice for all things property. Thank you.