In this episode, Melinda Jennison takes the guest seat, joining Liam Garman from the Smart Property Investment Show to deliver a timely and important message for all property buyers and aspiring buyers agents.
Melinda, President of the Real Estate Buyers Agents Association of Australia (REBAA), sheds light on some of the serious issues currently affecting the buyers agent industry.
Together, they discuss:
- The rise in underqualified agents and why it matters
- Legal loopholes and concerning behaviours behind the scenes
- Shocking stories of buyers left exposed by poor representation
- What questions every buyer should be asking before engaging a BA
- How REBAA is working to raise the standard across the country
This episode is packed with insight and a clear call for transparency, education, and ethical practice. Tune in for a must-hear conversation that puts consumer protection first.
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Transcript
Melinda Jennison: [00:00:00] Special edition episode of the Brisbane Property Podcast. We are replaying an interview that I had on the REB podcast with Liam Garman. We are going to be covering everything in relation to ethics, online courses, and loopholes that exist in the buyer’s agent industry that put buyers at risk. This is not an episode to be missed. We hope you see value.
Intro VO: [00:00:21] Welcome to the Brisbane Property Podcast with your hosts, Melinda and Scott Jennison.
Liam Garmin: [00:00:26] Good day, everyone. It’s Liam Garman here, managing editor of real estate here at Momentum Media, the team that brings you Real Estate Business and the Smart Property Investment show. I am joined by a fan favourite of both the REB and the SPI podcasts, someone that needs absolutely no introduction. I will introduce her anyway, Melinda Jennison, founder of Streamline Property Buyers and president of the Real Estate Buyers Agent Association of Australia. Melinda, welcome back to the podcast.
Melinda Jennison: [00:00:53] Thank you very much, Liam. What an introduction. I did not know there was a fan base out there, but that is pleasing to hear.
Liam Garmin: [00:00:59] There is a fan base. Just before we hit record on the podcast, we were having a bit of a chat. It is very favourable buying conditions with off the back of two rate cuts at the moment. Are you seeing a bit of an uptick? Are you getting a lot of enquiries from potential people looking to engage Streamline at the moment?
Melinda Jennison: [00:01:20] We operate predominantly in the Brisbane property market, and enquiry for Brisbane properties is sky-high. There has been some recent research that has indicated that investors are really focusing on South East Queensland off the back of the Olympic infrastructure announcements, and we have got political certainty now with the federal election now behind us. As you have rightly pointed out, two rate cuts already this year. Because of that, it is driving demand into the South East Queensland market as a whole, but our enquiry as a buyer’s agency service within the Brisbane market is extremely high at the moment. That is because there is a lot of buyers that are either struggling to get into the market or have interest in getting into the market in Brisbane, and they need some professional assistance to do so.
Liam Garmin: [00:02:10] Are they typically investors or PPORs?
Melinda Jennison: [00:02:13] Both. I would say that through our enquiry, we typically attract about 60% of enquiry from property investors, and they can be nationwide, but also from overseas markets, a lot of buyers that are expats monitoring the Australian market wanting to get into the market. We also have owner-occupier buyers that we service, and a lot of those are locals that keep missing out or people that are relocating and wanting to get professional assistance buying their home.
Liam Garmin: [00:02:41] That is quite an interesting point that you have an uptick from people looking for owner-occupiers that, and maybe I am putting words in your mouth, do correct me if I am wrong, they might in other market conditions not have engaged a buyer’s agent, but because the market is so hot at the moment, they are looking at these other avenues. Looking at those people looking for owner-occupiers, what are they looking for? Are they looking for anything unique? What is the Brisbane owner-occupier market looking like at the moment?
Melinda Jennison: [00:03:12] It is fairly widespread. I think that affordability constraints are definitely evident across the market. In that, there are fewer buyers above that two to two and a half million dollar price point across our city. The buyers are still there, but there are just fewer of them. I would say the most competitive segment of the market is anything up to about 1.5 million dollars, especially for home buyers. And for first home buyers, we have stamp duty concessions that cut off at $700,000. Anything priced at $700,000 or under right now in Brisbane, not only is there a lot of investor interest and enquiry on those sorts of properties, but we have got a very high volume of first home buyers competing for those properties as well. In fact, when we look at price segmentation, we know for a fact that in Brisbane in the last quarter, it is the most affordable segment of the markets, so the bottom 25% of property values that have grown at a faster rate than the middle 50% of property values or the top 25% of property values ranked by price. There is definitely more demand in that lower price point across Brisbane.
Liam Garmin: [00:04:21] I do not have anywhere near the depth of knowledge of the market as you do, but I can very visually see that even when I do my own desktop research of the Brisbane market, just how much that that bottom quartile is growing relative to the top quartile. When you are engaging that that owner-occupier market, what exactly are they looking for? What are their non-negotiables when they are when they are looking for a home? I want to get a little bit maybe of a profile of the buyer.
Melinda Jennison: [00:04:47] It depends on the buyer, to be honest. We have got downsizers that want to actually get into a home that is low maintenance, that has high levels of security, but they are in lifestyle locations. We have also got families that are would be looking for quality school catchments, accessibility to parkland, depending on the age of the children. These are the sorts of motivations that drive that market segment. And as I have mentioned, we have also got first home buyers, and they are typically more willing to compromise on the property type. They are looking at units and or townhouses in inner-city locations. It appears to me that that younger generation really want to focus more on lifestyle. They want to be in the areas where they can walk to the cafes, they can get their Sunday breakfast, they can get good coffee. And these are the things that matter more to them. They are looking at compromising on the property type by looking at townhouses and units.
Liam Garmin: [00:05:41] Which is quite an interesting insight. But I I definitely, I definitely see that that lifestyle creeping in as a priority for a lot of buyers. Melinda, one thing I would love to chat about today, it was a fantastic market oversight for Brisbane. One thing I would love to chat about today is you want to be a BA. And it seems Melinda that every time that I go on Instagram nowadays, I have got ads for courses, I have got people saying that you can you can become a buyer’s agent overnight, you can treat it as a side hustle, you can make a bunch of money from it. And Melinda, if I can be very frank with you, you know, I I do not want to go to a part-time surgeon. You know, that is that is the way that I look at it. And I engage BAs and and one thing that I like from my BAs is that it is their full-time job, that they do have a lot of care, they have a lot of, they take a lot of minute detail in in servicing their clients and looking after their clients. I would love to get a little bit of insight from your role as president of REBA about the journey to becoming a buyer’s agent. To start us off, what are the certifications that people need to become buyers agents? Surely it is not just as simple as a as a as a course that you buy online.
Melinda Jennison: [00:07:00] Absolutely not. And this is one of the biggest challenges that we have as an industry right now. And a big part of the challenge is educating the consumer who otherwise may not even realise that they are working with someone who may lack the expertise or the experience to be able to guide them appropriately through the purchase process. If I can just explain what is required to become a buyer’s agent. Unfortunately, one of the biggest issues with the licensing regime is that you must complete modules operated by registered training organisations that teach you how to become a sales agent or a property manager. However, very few of the modules that you must complete to obtain a licence teach you how to become a buyer’s agent. The first issue that we have is that our current licensing regime does not actually teach buyer’s agents the requisite skills and the required levels of due diligence that are necessary to protect buyers and mitigate risk throughout that purchase process. What I will also say is that the licensing regime is state-based, and we are seeing many operators actually take shortcuts. In some states, you must work under a principal licensee for a minimum of two years before you can hold an independent licence or a class one licence. What that means is that you cannot actually operate your own buyer’s agent business without that experience. However, people are actually getting around this requirement by being or becoming licensed in other states, taking shortcuts, and then using the licence from another state to obtain mutual recognition back in the state that they are purchasing property and representing buyers in. Is that legal? Yes, it is legal. The biggest issue is that if you are obtaining a licence in a state that you are not actually purchasing in, you are not learning the legislation that you must operate within for the state that you are purchasing within. You can see that there is a lot of concerns that we have for the industry. And it is a reason why REBA, the Real Estate Buyers Agents Association of Australia, are really working with each of the real estate institutes to develop training materials to educate buyer’s agents on what is required. And we have also recently endorsed a professional training programme that is commercially available so that consumers have a way to actually cut through the noise and choose a provider that is going to provide the requisite skills that they actually need to generate the required skill levels to represent buyers on their journey. That is the Buyer’s Agent Mentoring Programme, as the endorsed programme that we have gone through the process of vetting for consumers.
Liam Garmin: [00:10:00] You touched on you know, a very age-old consideration, which is what is legal does not equal what is ethical. Sure, you can take those you can take those shortcuts and and you are able to do it, but ethically, you you should not. And it is fantastic that you have that you have developed these training materials and and and come up with an endorsed training manual. For people that are listening to this that want to learn more about that, where can they find it? Who are the RTOs or how can they find out more information about that?
Melinda Jennison: [00:10:29] On the REBA website, you can obtain further information about becoming a buyer’s agent and the pathways required to become licensed. And there we have got links to the programme that we have endorsed, being the Buyer’s Agent Mentoring Programme, and also current training modules that are offered by some of the real estate institutes across some states in Australia. It is something that REBA is working very hard to roll out across all states, but at the moment it is only being provided in select locations.
Liam Garmin: [00:11:02] Surely off the back of this, you know, you would have heard some absolute horror stories from people that might have been serviced from from from buyer’s agents who who did not do the correct training or or their heart might not be in it, or they are not treating it as as the profession should be treated, they are treating it as a bit of a side hustle. As an aside, you know, I have I have heard some absolute horror stories from from my role here at REB and SPI, which is, you know, people saying that, you know, BAs would kind of just take videos from the agent and pass it on and not do any due diligence. And also the lack of understanding that as a BA, you are there to represent the best interest of the buyer, but they just kind of want to move people along, get the sale, close the sale, move on and not really appreciating, even from a business perspective, right, that actually, you know, the better you treat your clients, the more you service them, the better outcomes you get for them, it is actually better for your business. But not necessarily having that as a mantra and and not treating their clients with the due respect that they deserve. I am going to guess you would have heard some absolute horror stories, Melinda.
Melinda Jennison: [00:12:04] Unfortunately, Liam, we have. I think a lot of consumers mistake our association as being the governing body for the buyer’s agent industry. Unfortunately, we are not the governing body. We are an association that exists to ensure consumers have a way to select a buyer’s agent who we know abides by a professional code of conduct, operates in an ethical way and meets a minimum service standard. Because consumers have a misconception thinking we are the governing body, we do receive complaints, not about our members, but about other buyers agents operating within the industry. We have heard all sorts of complaints. If I can give you an example of one, a client that has reached out to our association to report a buyer’s agent who they had a horrific experience with. They put their trust in this particular buyer’s agent to purchase them an investment property that was in a regional location. They went through and purchased that investment property, and it was only upon settlement that their problems started to unravel. What happened is that the property manager that they had engaged confirmed with them that the property was not habitable. It was unable to be rented in its current condition. Because of that fact, they went back to their buyer’s agent and started to ask questions. When did you inspect the property? Why has this been recommended to us if it is not able to be rented? And they were provided with a quote in excess of $14,000 to rectify the issues on that property before it became habitable. Of course, that is a significant issue for those particular buyers because not only have they paid for the services of a buyer’s agent, but they now realise that that buyer’s agent had never been to the property, had only made a recommendation off the photos that they had seen online and or the agent’s advice. This is happening every single day. This is not a one-off scenario. Unfortunately, what we see happening is that a lot of these buyers are then silenced through legal deeds of settlement. They are unable to talk about their experience because the buyer’s agents that are involved actually shut it down through legal settlements. They pay, they pay for the silence effectively, which is just horrific to know that this is happening within our industry. And it is our job as as representatives that are doing the right thing, and my job as the president of the Real Estate Buyers Agents Association of Australia, to warn consumers that this is happening and one way that they can prevent this from happening is to align with people that we know are ethical, that are doing the role of a buyer’s agent at the highest possible level. And then therefore, there is going to be less risk to the consumers.
Liam Garmin: [00:14:53] My knowledge of the of the legal side is not isn’t very strong. A deed of settlement would be literally a settlement that the BA would then give them some some money back, but you would get like a non-disclosure out of it.
Melinda Jennison: [00:15:07] I believe that the, yeah, they are they are paid, the buyer’s agent would pay the client or refund the fee that they otherwise paid in exchange for them not talking, them not talking about their experience, from them not going to the media about their experience. They are unable to share that experience with others to warn others that this does happen in the industry.
Liam Garmin: [00:15:28] I will do a shout-out if anyone, if anyone needs a journalist or if anyone needs the hand of real estate business to look into it, you know, we are just an email away, liam.garman@momentummedia.com.au, but this it raises a few questions because we we do not know the extent of it to your point, which is if you have a non-disclosure as a result of a deed of settlement, you don’t really know how far and how wide this goes. Putting yourself into the client’s shoes, if you are someone who is interested in in engaging a BA, it could be for any of the reasons that we said before. It could be you are looking for a, you are looking for a good investment in in a city that you might not know or even on the on the PPOR front, hey, the stock is just going in a matter of hours. I can’t even get there on time, or I have got such a demanding job I would not even have the time of day to inspect. For either of them, if you are looking to engage a BA, what what should you look for? What are some ticks of approval that you could say as a client, I hand-on-heart trust this BA to work in my best interest?
Melinda Jennison: [00:16:32] I think it is important that you not only look at their online presence, but actively engage with them and ask them some questions to understand the extent of their knowledge about the local area. I am a huge advocate for local area specialists. Not only are you going to get the knowledge and intel that data can provide you, but you can overlay that with local area knowledge. And I feel that that gives you a much higher level of expertise outside of anything that fly-in, fly-out or borderless buyer’s agents can provide. I think it is important that consumers ask their buyer’s agent whether they are adequately licensed in the locations that they are buying in. You have a right to actually ask your buyer’s agent to provide evidence of their licence class. If you are actually working with a buyer’s agent in one state, you have a right to ask them, has the licence that you are operating under been obtained in this state or have you obtained it elsewhere and obtained mutual recognition? That is going to give you a depth of knowledge in terms of how experienced they are and have they followed the procedure that is best practice or cut some corners, if you like. Again, I have mentioned previously, it is legal, however, it does break down that that ability to learn the correct legislation for the the state that you are purchasing within. And I would also ask, are they members of the Real Estate Buyers Agents Association of Australia? We provide a level of due diligence for consumers so that they don’t have to do the groundwork. Every one of our members meets minimum standards, has adequate professional indemnity insurance in place, which is ultimately a protection for the consumer. Every one of our members is adequately licensed in the states that they are purchasing in because this is part of our membership application process. And we know our members are very thorough in the due diligence process that they take a client through to mitigate risk on behalf of the buyer. And this is all about protecting the consumers.
Liam Garmin: [00:19:18] It is good that we want more standards. And for people to to complain about the standards is is quite ironic because what you are actually doing is you are improving the industry.
Melinda Jennison: [00:19:27] Raising the standards, raising the industry.
Liam Garmin: [00:19:29] Correct. I think if I can just say Liam one extra thing about that is I think that there has been a lot of buyers agents that have received information that is misrepresented about our association. Again, and they have been told potentially by others who may have a commercial interest in providing training within the industry that being a member of REBA adds no value. However, I think that there are many buyers agents that within REBA understand the value that we do add. Obviously credibility in the market. We provide the one of, I believe it is the only buyer’s agent specific conference, annual conference for members. Real estate agents get some amazing opportunities to upskill at conferences like AREC. Buyers agents go to conferences like that and there is there are no speakers that talk to the buyer’s agent profession, whereas we have a two-day conference specifically aimed at buyer’s agents for members. This is a huge value add as well as member webinars and other opportunities for members to engage and learn from each other through our members forum. There is some misleading information in the industry as a whole, and people potentially have been brainwashed to believe that that REBA adds no value, but in actual fact, once people are members, they really understand what value we do add.
Liam Garmin: [00:20:53] It is good to say hand on heart that with all those checks and with all the balances, the indemnity insurance, for example, that you are actually putting your clients first. And I am actually as we are as we are on this podcast, now I am scrolling through your website and and reading about that and it is fantastic to see all the work that goes into that. Now, I know this might be a bit of a an off-the-cuff question, but one thing that just popped into my head looking at this was, you know, buyers agents are there to represent the best interests of the buyer. How how does REBA work with say buyers agents that also work with say off-the-plan land packages where you might be getting a commission from both ends?
Melinda Jennison: [00:21:38] Such a good question. Unfortunately, buyer’s agents that do take secret commissions from developers and builders in the way that you have described, won’t qualify for membership with REBA because that is actually against our code of conduct.
Liam Garmin: [00:21:52] Well, that seems quite reasonable, right? It is like whose team are you on? Like, really?
Melinda Jennison: [00:21:55] Our members are exclusive buyers agents, they are not involved in any form of direct selling and they are not receiving any hidden commissions from developers or builders to recommend brand new properties. And I think that is another point of difference again that consumers may not be aware of. We are there purely to advocate for the buyer and represent the buyer’s interests as our primary priority.
Liam Garmin: [00:22:19] With with some of those training training associations that you said with before, surely there is to be licensed some ethical code of conduct which says that buyer’s agents have to put the best interest of the buyer first. And and forgive me, because I have not I have not done buyer’s agent training, but would that not be against some licensing code of conduct if you are kind of if you are if you are receiving a commission from both the seller end and the buyer end?
Melinda Jennison: [00:22:48] Technically, it is illegal to receive a commission from both buyer and seller. That is certainly the case under the Property Occupations Act here in Queensland, and I believe it is the legislation in most other states around Australia. The problem is that some people are very happy to operate outside of the law. And you know, I say that with a word of caution. Some people may not know that they are actually operating outside of the law by doing this either. It comes down to understanding legislation, and when people are getting licensed in states that are not the states they are operating in, they may not even be aware of the legislation that actually applies because they have not learnt it. And this is one of the big problems with our industry. There is definitely some people that will call themselves buyer’s agents and not charge a buyer, but they will be taking those hidden commissions from a developer or a builder. I think that is a different proposition. Again, those people are not REBA members. REBA members are engaged by a buyer to represent the buyer but do not take any additional hidden commissions from developers to recommend brand new products.
Liam Garmin: [00:23:57] I appreciate everything you have said. I think I maybe because of your position you have to be a little bit more diplomatic. I I won’t be diplomatic because I do not buy it that you can’t be aware of the legislation. It is it is purely logical that, you know, you would have you would have done a course or two, you would understand that someone is paying you their hard-earned to buy a property and represent them. I do not buy it that you are just unaware of of the legislation because it actually is it is just so illogical that you could potentially take take money from both sides and and think it is okay. But anyway, I will leave it there because I can feel my heart rate going up out of annoyance.
Melinda Jennison: [00:24:38] I think also, you know, there is there are definitely people in business that are prepared to operate knowingly outside of the law. We see that in the buyer’s agent industry all the time. As a local buyer’s agent here in Brisbane, we receive phone calls from other buyer’s agents who are calling an off-the-plan list. And what I mean by that is that we have been through a property along with a number of other buyers, and that selling agent sells that list to a buyer’s agent. The buyer’s agent then calls off that list to generate business. Now, there is potentially a financial reward or incentive for the selling agent to pass on that list. But both selling agent and buyer’s agent in that situation are in breach of the Privacy Act. When you are handing over your information, when you are checking into a property, that information is your private information. I am going to put a call out to any listeners, if you are getting a call from a buyer’s agent after being through a selling agent’s property, ask the question, how did you get my private details? Because I have not given you consent to contact me because this is again happening within our industry. And unfortunately, those that are prepared to engage in this unscrupulous activity are impacting or diluting the impact that the rest of us that operate in an ethical way with high standards, they dilute the impact that we are able to have within the industry, and it is a real concern that we have.
Liam Garmin: [00:26:07] It is good that you are calling this out and that you are being such a such a massive advocate for for ethics in the industry because there are a lot of unscrupulous people out there. Thank you for all the work that you are doing. Now, we can’t just be negative. That is my fault because I have been asking all the questions. I can’t just ask the the hard, challenging questions. You know, for for people that do want to become BAs and they they might have seen the Instagram ads or looked online and thought, hey, this is a career that I really want. And credit to them, they are listening to podcasts like this and they are trying to upskill themselves and and learn from people, Melinda, like yourself in the know. What are some of your top tips and tricks for people that are serious about this journey and want to become industry-leading buyer’s agents?
Melinda Jennison: [00:26:54] It is such a great question because it is something that we quite often get asked. And I would say when you are learning, do not assume you know everything because there is so much that you do not even know that you do not know. And therefore, seeking out the assistance of a mentor and or participating in programmes that are going to give you the real skills that you need. And as I have pointed out a couple of times, there is not a lot of credible programmes out there that are going to give you the skills to become skilled very quickly. But the Buyer’s Agent Mentoring Programme is one, details of that are available on the REBA website. It is the only programme that is REBA-endorsed that is available on the commercial market right now. It consists of 12 modules helping people understand what they need to cover to protect themselves as a buyer’s agent from risk, but also to protect the client that they are representing. There is also the Buyer’s Agent Essentials programme, which is actually a two-day event that I run in conjunction with a fellow colleague of mine here in Queensland, and this is delivered through the Real Estate Institute of Queensland. Again, it is teaching people the skills that are required to operate within the legislative framework that exists within our state. And this is critical. Seek out credible courses that are going to teach you the skills you need to know, not just the skills to create a lead pipeline, because once you actually have clients, you must understand how to service them in a way that mitigates risk for them, but also prevents future liability for yourself. And at this stage, there are very limited options available. Once you have been operating for at least 12 months, we would encourage all buyers agents to reach out, join REBA. Not only will you have access to some of the more experienced buyers agents that have been operating within the industry for 15 plus years that you can learn on and leverage your skillset from, but you will also get access to member webinars, our annual conference, and the credibility that being a REBA member provides when you are talking to buyers or potential clients that you are onboarding.
Liam Garmin: [00:29:11] For sure and and doing things like meeting those stringent checks and balances that you have in place at REBA, the indemnity insurance, all of that is is for the benefit of your clients. And in the long term, I am not a BA, but in the long term, if you have more happy clients, more clients that are looked after, in the long run, it is probably good for business as well.
Melinda Jennison: [00:29:32] Absolutely. Every single client that you work with becomes your brand ambassador. If you have given a client a poor experience, I can guarantee you they are going to tell more people about that poor experience. If you have given them a good experience, they are going to become your advocates and they are going to refer business into you for future years to come, as opposed to the former where my name within the industry is being impacted because of the experience that I am providing. It is one client at a time, one transaction at a time, really advocating for what is best for the buyer, and that is how to build a brand and to build a business that is reputable in the current market.
Liam Garmin: [00:30:19] Absolutely. Now, Melinda, I know when we were talking via email before this podcast that your phone has been ringing off the hook and there is a lot of a lot of demand for Streamline at the moment. I better let you go. Thank you so much for joining us on the podcast.
Melinda Jennison: [00:30:34] Thank you so much for having me once again, Liam. It has been a pleasure.
Liam Garmin: [00:30:37] No, thank you. And that was Melinda Jennison, founder of Streamline Property Buyers and President of the Real Estate Buyers Agents Association of Australia. And that is all we have time for today. And we will be back at the same time next week with another episode. But until then, bye-bye.