PropNex to fire non-performing agents this week

http://www.channelnewsasia.com/stori...362288/1/.html

PropNex to fire non-performing agents this week

By Ng Baoying, Channel NewsAsia | Posted: 23 July 2008 2200 hrs


SINGAPORE : One of Singapore's biggest real estate agencies, PropNex Realty, is firing more than one-third of its agents. According to its CEO, the move is aimed at cleaning up the profession.

PropNex is firing those who have been with them for over a year, but have yet to submit a single transaction. About 2,800 agents currently on its list will be affected.

The agents were first given a choice to remain as PropNex agents by signing up for Professional Indemnity Insurance as well as a refresher course.

This group is seen as the riskiest for consumers as they may not be as updated on industry changes. There is also the possibility that this group may not be declaring their transactions, which poses a problem when consumers consult the agency and find that there are no records of the deal.

Mohamed Ismail, CEO of PropNex Realty, said: "Consumers are not protected in terms of professional standards provided by the agent. There's a lot of concern and a call for industry to be regulated.

"This did not happen in the last couple of years, so now the initiative should be for big players to self-regulate and move forward."

A lack of direct and stiff regulation for housing agents has allowed the existence of what some industry players call "cowboy" agents, who profit by flouting rules, and leaving customers and their agencies to deal with lapses.

So industry players said it is time the agencies do something about it.

"It would be forward-looking for any agency (to) ensure that their agents are properly trained, ... professional, ethical and exercise some kind of control," said Low Swee Kim, Vice President at the Institute of Estate Agents.

The industry first tried to regulate agents with a qualification examination, called the Common Examination for House Agents. But since it was not mandatory, it did not have the desired impact of setting a minimun standard for housing agents.

The Institute of Estate Agents (IEA) has also been pushing for second-tier licensing, but to no avail. Currently, only agencies are licensed.

A housing agent database pioneered by the IEA has also fallen short so far, because not all real estate agents have opted in.

Industry players compare this situation to that of the insurance industry, where agents are guided by tough regulations by the Monetary Authority of Singapore.

It is estimated that only one third of real estate agents are properly qualified.

"There's no educational barrier to entry, so anyone can join the industry. Typically, training is only provided if the agent joins a relatively big company where there is some structure in place," said Eugene Lim, Associate Director of ERA Asia Pacific.

As a major realty agency, ERA said it has training systems in place for its agents.

PropNex's CEO said this is just the start of an entire overhaul.

Ismail said: "At the moment, PropNex is at the drawing board working out some policies and programme. If the authorities are not prepared to regulate the industry, some of the big players (like) ourselves, we would like to self-regulate.

"We have to just move and take the lead role to make a difference. And doing that, I think (others) will follow.

"We are in the planning stage and (soon),... we should be able to reveal some of our new policies and procedures that will put a check on all our agents, in terms of their conduct and responsibility."

PropNex is also looking at creating avenues to give redress to consumers who have problems with their agents. - CNA /ls

Why would they want to fire at this time?

http://www.businesstimes.com.sg/sub/...89218,00.html?

Published July 25, 2008

More property agents may head for exit

PropNex's sacking of 2,800 inactive associates seen as bold, drastic

By UMA SHANKARI


(SINGAPORE) Many more property agents could quit the industry - or be forced to leave - in light of the current market downturn, say industry players.

'The market was very bullish in the last two years, so the barriers to entry were not there for a lot of agents,' said Cushman & Wakefield managing director Donald Han. 'Now that the market is tightening, property companies want to look for the performers, and let the rest go.'

On Wednesday, PropNex Realty said that it was firing more than one-third of its agents. About 2,800 agents who have been with the firm for over a year but have yet to record a single transaction will be terminated, PropNex said.

Industry players told BT that during the property upturn in the last two years, a number of 'non-typical' agents entered the industry in order to make a quick buck. One property analyst told BT that at the height of the property boom, he had 'civil servants, clerical staff and others with regular day jobs' looking to join his firm to 'make some extra cash'.

'There were a lot of fly-by-night agents - people who didn't know the rules,' he said.

But with the current property slowdown, many of these agents have been unable to close deals and therefore have left the industry, market players said. More could follow, they added.

PropNex said that many of its inactive associates may no longer be familiar with current market trends or the latest policies. 'If that is the case, then they would hardly be able to best serve the customers' interests,' said chief executive Mohd Ismail.

The agents were first given a choice to remain with PropNex by signing up for Professional Indemnity Insurance and a refresher course.

Observers called PropNex's move 'bold' and even 'drastic'. The industry here is largely unregulated and there is sometimes confusion over agents' qualifications and accreditation.

Industry veterans, however, pointed out that some of the agents fired by PropNex could be registered with multiple agencies and so could have recorded transactions for other firms instead. There is also nothing preventing fired agents from joining another agency, they added.

What the industry needs is more education, said Ku Swee Yong, director of marketing and business development at Savills Singapore. 'If they (the fired agents) are serious about the industry, they should take advantage of the now relatively stable market to upgrade themselves and deepen their knowledge,' he said.