A New World Order for the Property Sector?

The 3rd of April 2012 was an important day for anyone with an interest in the property sector in Ireland. Standards of Property Services provided by:

  • Auctioneers
  • Letting Agents
  • and Property Management Agents

will now be set and enforced by the new Property Services Regulatory Authority (“the Authority”) which was established by the Government on that date. The need for this new Authority to address perceived issues in the property market and the provision of property services, was the primary driving force behind the Property Services (Regulation) Act 2011 (“the Act”) which was signed into law on 20th December 2011. While much of the Act is not yet operative, the signing of the relevant Commencement and Establishment Orders by Minister Shatter on April 3rd has put the Authority on a statutory footing.

The Ministerial Order of April 3rd commenced Part 2 and Part 12 of the Act as well as a number of Preliminary, General and Miscellaneous sections contained in Parts 1 and 13. Part 2 governs the establishment, functions and operation of the Authority. For example, Section 18 empowers the Authority to prepare and publish Codes of Practice for the purpose of setting standards for the provision of property services. Once approved, any such Codes will not have the full force of law but a court or tribunal may have regard to any provision of a Code of Practice in any proceedings under the Act.

Part 12 provides for the monitoring and publication of residential property sales prices as well as the establishment of a Commercial Leases Database. The inclusion of this Part in the first Commencement Order confirms that the task of creating greater transparency across the property market will be an early priority for the new Authority. Significantly, the Act imposes a duty on the Tenant in a Commercial Lease entered into on or after April 3rd, to furnish the Authority with particulars of the Lease including the rent and any capital consideration to be paid by the Tenant to the Landlord. Failure to comply will constitute an offence under the Act, punishable by a fine of up to €5,000.

The Authority will also be responsible for the licensing of Property Services providers and, when Part 3 of the Act is commenced, any unlicensed person providing a licensed Property Service may be guilty of a criminal offence and subject to a fine and/or imprisonment of up to 5 years. The wording of Section 11(3) provides a useful indication of the general approach to be adopted by the Authority: “The Authority shall, in performing its functions under this Act, promote the best interests of clients and other users and potential users of property services in a manner that is consistent with the orderly and proper functioning of the property services markets and the orderly control and supervision of the providers of those services.” In short, the Act will have a significant impact on a broad range of people and organisations involved in the property sector, whether they are providers of property services or consumers of such services. It is not possible to provide a comprehensive review of the Act in this setting and the above is only a taste of some of the key changes that are being brought about by the new legislation.

f you would like to learn more about how the Act will affect you, we would be happy to meet with you to discuss your individual circumstances. Give us a call on 051 874909 or contact us to arrange a meeting with one of our team. The foregoing is for information purposes only and does not constitute legal advice. Please consult a solicitor if you require legal advice concerning any of the issues raised in this article.