Regulating residential property managers
On this page you’ll find information about the proposed regulations and the indicative timeframe for their implementation.
About the Residential Property Managers Bill
The Residential Property Managers Bill (The Bill) was introduced to Parliament in August 2023.
The Bill aims to create a comprehensive regulatory regime for residential property managers and residential property management organisations. This provides assurance to property owners, and the tenants that rent their properties, that all residential property managers meet conduct and competency standards and are qualified and accountable.
Nearly a third of New Zealand households live in rental accommodation and around half of those residential rental properties are looked after by property managers. While many property managers abide by appropriate professional standards, the sector as a whole is not legally required to meet minimum conduct, competency and industry practice standards. This could mean inconsistent quality of services for tenants and owners. Regulation would give tenants and property owners confidence in the quality of the property management services they receive.
The proposed new regulatory system will include:
- compulsory registration and licensing for individual property managers and property management organisations,
- training and entry requirements,
- industry practice standards, and
- a complaints and disciplinary process.
The key features of the proposed regime are set out in the table below:
Scope
In scope
- Residential property managers (RPMs) in trade
- Residential property management organisations (RPMOs)
Out of scope
- Private landlords (including their employees where relevant)
- Public landlords: including Kāinga Ora, its employees and agents (for the part of their work that is for Kāinga Ora)
- Community Housing Providers and their employees
- Residential property management activities where there is no expectation of payment, because they are not in-trade
- Commercial property management services, but if they also provide residential property management services they are included for the part of their work that is for residential properties
Licensing and registration
- Licensed residential property managers to appear on a public register
- Three-tiered licensing structure for residential property managers (provisional, standard and supervisory)
- Minimum qualification and training requirements for each licence class
- RMPOs are also licensed will appear on a public register
Further entry requirements
- Minimum age of 18
- Not be barred under the specific prohibitions contained in the legislation
- Meet a fit and proper person test (regulator will publish guidance about how they assess whether someone is ‘fit and proper’)
- Industry experience requirements (for standard and supervisory licence classes but not for provisional)
Professional and industry practice requirements
- Continuing professional development (CPD)
- Code of professional conduct and client care
- RPMOs to operate trust accounts that are subject to an annual audit
- RPMOs to meet prescribed insurance requirements
Regulatory authority
- The Real Estate Authority (REA)
Complaints and discipline
- Independent complaints and disciplinary framework to address complaints relating to the professional conduct of a property manager or property management organisation, which involves a breach of the legislation or its associated regulations or rules
- ‘No wrong door’ for complaints and disciplinary matters
- Complaints Assessment Committees (powers aligned to real estate)
- Independent Disciplinary Tribunal (powers aligned to real estate)
Offences and penalties
To address issues relating to:
- Providing false or misleading information
- Practicing, trading, or employing while unregistered or unlicensed
- Failing to produce financial records
- Failing to hold money in audited trust accounts or rendering false accounts
- Failing to disclose a conflict of interest that results in financial benefits
- Failing to comply with a lawful summons
- Acting in contempt of the Tribunal
Regulatory stewardship and monitoring
- Te Tūāpapa Kura Kāinga (HUD) to act as regulatory steward for the property managers regime
Timing
If the Bill is enacted:
- there will be an 18-month period to allow for the Regulatory Authority to establish systems and to allow for the making of regulations and operational standards.
- a further 6 months will be allowed for residential property managers and RPMOs to get licensed before the regime takes full effect (24 months after enactment).
To follow the Bill's progress, please visit the Parliament website.(external link)
