The Government is to establish a new authority to monitor estate agents and auctioneers in an effort to restore public confidence in the profession, it was announced today.
Minister for Justice Michael McDowell said this afternoon he believed an authority, which would licence agents and auctioneers and sanction them for breaches of ethics, was necessary due to a considerable level of concern among the public about certain selling practices.
He said there was "a sufficient level of consumer dissatisfaction", particularly in respect of certain property selling practices and the absence of redress for clients when things go wrong, to warrant the establishment of an agency.
In July last year, the minister set up a review group to look into all aspects of the auctioneering profession. In its report, published today, the group recommended the setting up of the Regulatory Authority, which will be responsible for licencing auctioneers, estate agents, lettings companies and property management agencies. Responsibility for issuing licences will be transferred from the Courts Services.
The authority will also have powers to regulate, monitor and inspect auctioneers' activities. It will be responsible for making consumers aware of their rights and offering them protection and redress when these are breached. The review group added that it should be a criminal offence to operate without a licence.
The Government has approved the report's recommendations and will set up the regulatory authority on an interim basis. It will be situated in Navan, Co Meath at an initial cost of €250,000. Future costs will be met by the revenue generated from issuing licences.
Mr McDowell said the authority was designed to provide a "robust, progressive structure to underpin a high quality, transparent, and consumer friendly property market into the future."
The minister said in particular, he would like to see the establishment of a paper trail in private treaty sales to ensure people were not bidding for properties against "mystery" bidders or, indeed, themselves.
He also wanted to tackle the practice of setting "overly optimistic" guide prices on properties up for auction. Often, he said, purchasers find themselves paying for surveyors and legal fees only to find out the house advertised at a certain price was way over their maximum limit.
Mr McDowell said he suspected these "unrealistic" guide prices were designed solely to lure people into bidding wars.
Mr McDowell insisted there was a genuine desire among auctioneers and estate agents for stricter controls to eradicate unethical behaviour. It wasn't "a case of me taking out the big stick and hitting the big rogue with it", he said.
The Institute of Professional Auctioneers and Valuers welcomed the announcement. The IPAV chief executive, Liam O'Donnell, said there was a clear need "to regulate licence holders who are not members of an established institute".
