Industry must advocate property regulation

30-Jun-2014

By Krystine Lumanta

Email Article Print Article

Related Articles: | |

Financial planners, accountants and mortgage brokers must collectively call for regulation of the property sector to improve its image and drive out spruikers, according to a property platform provider.

DomaCom head of sales and marketing Warren Gibson said that by doing so, advisers could add to their qualifications, differentiate themselves with a stronger value proposition and expand their client reach to increase their fee basket.

Joining the Property Investment Association of Australia or the Property Investment Professionals of Australia were ways for the industry to get behind property regulation.

The two bodies were set up to help regulate the property advice and provided education, qualification and a code of professional conduct and ethics, Gibson said.

His comments come amid increasing concerns as DomaCom meets with the advice industry about its recently launched fractional investment product.

“Much has been written about investing in the property market, particularly in relation to the self-managed super [SMSF] sector, with concern voiced from many quarters about its appropriateness given the high cost of property and its potential to overweight in portfolios and the lack of regulation surrounding property,” Gibson said.

“Investors are warned to beware of setting up an SMSF for a single property asset and of the dangers of a lack of liquidity in their portfolio.”

The industry had an opportunity to drive out spruikers in the marketplace and give the property investment sector a better image, while also giving consumers more protection through qualified advice and property recommendations, Gibson said.

“If financial planners, accountants and brokers support these bodies and gain the credentials being offered, they can increase their client reach, extend their revenue potential and bring property into a regulated space,” he said.

“This will help protect their client base and deliver better outcomes.”

He said DomaCom’s fractional property investment fund gave residential property its first taste of regulation.

Financial advisers cannot use the product until they have successfully completed the accreditation program.

« Back to Articles