The Queensland Property Occupations Bill 2013 was introduced into State Parliament on 20 November 2013. Upon commencement of the Bill it will replace the Property Agents and Motor Dealers Act 2000 (PAMDA).

Policy Objectives

The objectives of the Bill are to:

  1. provide for the repeal and split of the PAMDA. The Bill is one of four Bills that will split the PAMDA. The Bill regulates property related occupations and aims to achieve an appropriate balance between the need to regulate for the protection of consumers and the need to promote freedom of enterprise in the market place;
  2. simplify and reduce the level of red tape and regulation the PAMDA currently imposes on the property industry; and
  3. improve the operation of the legislation and clarify particular provisions.

Notable Changes

Some notable changes include:

  1. Streamlining home sale contracts and statements: Currently the PAMDA prescribes a complex process which must be followed when presenting and delivering residential real estate contracts. These processes require several approved forms to be presented and delivered to a real estate buyer in a specified way and order. In addition, failure to comply with the existing provisions of the PAMDA constitutes grounds for terminating the contract.

  2. The Bill repeals the existing warning statement provisions and replaces them with a simple requirement for a prescribed statement to be included in particular home sale contracts.

    Failure to comply with this provision results in a penalty of up to $22,000 rather than the right to terminate.

  1. De-licensing of property developers: The Bill removes the requirement for property developers and their employees to be licensed. It is considered the significant red tape reduction measure may generate employment growth, reduce barriers to entry in the property developer market, encourage market entrants and in turn, increase competition.
  1. De-regulation of real estate commission cap: The PAMDA prescribes a rate of maximum commission, initially intended to protect consumers. However it has been found that due to the lack of price competition, the maximum commission rates set by the Government have effectively become the rates that agents charge. The Bill repeals this provision.
  1. Buyer's notification of termination during cooling-off: The Bill removes the requirement for a buyer to state in a termination notice the section of the legislation they are using to exercise their statutory cooling-off rights. The Bill also removes the requirement for the termination notice to be dated.
  1. Statutory cooling-off period applies to an option contract but not the subsequent contract: The Bill clarifies that the statutory cooling-off period only applies to an option and not the contract formed when the option is exercised. This applies however only when the buyer is the same party to both the option contract and subsequent contract.
  1. Allow Resident Letting Agents to manage more than one Building: The PAMDA currently imposes a limitation on the number of building complexes a resident letting agent can manage. These provisions have been considered onerous and are repealed by the Bill. The Body Corporate and Community Management Act 1997 will however continue to regulate resident letting and protect consumers.
  1. No longer require Resident Letting Agents to reside on-site: The Bill removes the requirement for a resident letting agent for an apartment complex to live on-site.
  1. Definition of Residential Property: The Bill replaces the definition of 'residential property' contained in the PAMDA with a simple definition to improve the operation of the legislation. Clause 21 of the Bill provides "residential property is real property that is used or intended to be used, for residential purposes but does not include real property that is used primarily for the purpose of industry, commerce or primary production." It is envisaged that coupled with the removal of the termination right for failure to comply with former warning statement provisions, it will reduce the level of litigation that has occurred in relation to the definition.

View the Bill by clicking the link below:

https://www.legislation.qld.gov.au/Bills/54PDF/2013/PropertyOccupB13.pdf

Conclusion

The proposed changes will be welcomed by the development industry which has been unnecessarily burdened by residential buyers seeking to terminate contracts based on minor technical grounds under the PAMDA.

Submissions on the Bill can be made to the Government by 5:00pm on Friday, 8 March 2014.

We will keep you up to date with any developments.

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