A report in Fairfax media outlets earlier this week claimed the government has drafted legislation that will require those entering the financial advice industry from 2017 onwards to hold a degree, pass an exam and undertake a year of professional development before they can operate.
Existing financial advisers would be given to 2019 to complete a bridging course and hold a degree or an approved equivalent.
Ben Kingsley, chair of the Property Investment Professionals of Australia (PIPA), said while the government’s plans would be a step forward for the financial advice sector, smaller steps should be taken to better regulate the property investment advice industry.
“Regulation has been in place in financial services of many years and their move to such a level of professionalism is a good sign of an industry trying to be a high performance profession,” Kingsley said.
“I’d firstly like to see our industry get regulated with a baseline entry level qualification and then as the property investment industry matures and moves with the time, I’d like to see it being added as a syllabus option or specialisation within the financial services degree at some point into the future,” he said.
While he doesn’t believe those in the property investment industry should be required to hold a degree, Kingsley said those working in the sector can learn something from those in financial services.
“At PIPA we are a strong believer that anyone giving property investment advice needs to practice in line with how financial planners work. That means they should tailor a solution based on the clients goals and it must consider their risk profile as part of this assessment,” he said.
“With this in mind, we think it’s important that property investment advisors have some level of education in the property investment space, such as a Qualified Property Investment Advisor (QPIA) or equivalent.”
While the qualification level proposed by Kingsley may not be as stringent as what the government is considering for financial advisers, he believes it would still go a long way to cleaning up the property investment advice industry.
“You only need to look at what having a minimum standard of qualification has done to improving the broker industry, the real estate industry and the building industry.
“Sure there still might be a small number of bad apples, but it would be far less than the spruiking we see going on at the moment.”
