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Property Occupations Act furphies

19 Nov 2014

We’ve always wanted to use "furphy" in a newsletter, and to get it in the headline makes it even sweeter.

If your ear has been even remotely to the ground on the legislative front recently you will have heard about the new Property Occupations Act 2014 (the PoA).

The PoA takes over from the Property Agents and Motor Dealers Act 2000 (PAMDA) on 1 December 2014.

We first wrote about the changes in November last year. The PoA contains some relatively substantial amendments for all real estate agents in Queensland, which includes any resident managers who operate under a resident letting agents licence.

Unsurprisingly, with the new legislation there are a few bush lawyers reading into it things that do not exist. Those things have already become urban myths which this newsletter will dispel. 

Misconception #1

We first wrote about what creates the obligation for resident managers to reside on site almost four years ago. 

The requirement to reside onsite could arise under either:-

  1. PAMDA; or
  2. The management rights agreements.

This has now changed with the PoA.

The second part of this article is now obsolete as the government has removed the obligation for resident managers to reside onsite from a licencing perspective.

The government has not changed the position from a contractual (i.e. management rights agreement) perspective.  What the management rights agreements say must still be adhered to – so the first part of the article remains spot on.

If a management rights agreement requires a resident manager to reside on site then they must still do so, regardless of what the PoA may allow from a licencing perspective.

Misconception # 2

While letting appointments on the new PoA form 6 will in effect become automatically assignable under the PoA, the same cannot be said of letting (or caretaking) agreements.

The distinction needs be to drawn between what the PoA deals with and what the Body Corporate and Community Management Act 1997 (BCCMA) deals with.

The PoA regulates real estate agents.  While a resident manager is a real estate agent it is also a service contractor and letting agent through the management rights agreements under the BCCMA.

The rights of bodies corporate under the BCCMA have not changed with the advent of the PoA.  A body corporate still has the same statutory rights with respect to assignment of management rights agreements as it always has had.   Approval of a body corporate to the assignment of management rights agreements is still very much required.

Misconception # 3

An RLA is still limited to letting lots in a scheme for which it holds a body corporate approval (i.e. a letting agreement / authorisation).  An RLA cannot let lots anywhere it doesn’t have a body corporate approval. Of course if you operate under a full real estate licence these RLA restrictions do not apply to you. 

Misconception # 4

All existing letting appointments on a PAMDA20A that are lawful and valid will remain lawful and valid under the new PoA regime.  You do not need to redo all of your letting appointments on 1 December.  If you pick up new managements after 1 December you will need to do them on the PoA Form 6.  One reason you might go and get news ones, even though you have valid ones already, was explained here.

That covers the major ones for now.  Enjoy the legislative transition! 

If you need any assistance underdstanding how the PoA impacts you we are always happy to help.

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Comments
Kris Racette w
Posted about 2 years ago
best management rights related article I've read on the subject so far. Clear and consise. Why aren't I receive your newsletters atm?
Peter Robinson w
Posted about 3 years ago
HI Frank I went to the REIQ brefing yesteday at Chandler and the presenter ( new boss of REIQ) was saying that in section 7 of Form6 re commission that we need to show a dollar amount or if a % then what that dollar amount will be. My question ( we were not allowed to ask questions) is if you put it as a percentage of the rent say 5% of weekly rent. This would look like 5% of weekly rent i.e 5% of $375 ( If the rent is $375) BUT what happens if the owner agrees for a new tenant to pay $360, the agreement is now compromised as the commission is stated as 5% of $375 not $360 .