By: Rosemary Johnston – Monday, May 27, 2013
PIAA was formed in response to serious concerns about the lack of transparency and professionalism in the property investment advice sector. Investors were being exposed to real estate selling tactics and being channelled into unsustainable property holdings that didn’t support their life time wealth creation. Many were effectively being fleeced of their accumulated capital.
PIAA began as an investors’ association focused on the new standards identified by the Joint Houses Parliamentary Enquiry post Henry Kaye. Their report was entitled Safe as Houses. It has since developed into a professional assocation with a strong focus on professional standards including the FOFA* legislation.
It has pioneered a range of initiatives including:
Property Information Standardisation
This supports investor comparison of property investment opportunities based on their factual merits rather than their emotional appeal.
This took the form of a Due Diligence Audit to rate off the plan investments. It covered over 200 categories of information and the results were reported as a five star rating. This required independence and kept the profile of this organisation low. This process is now managed by an external company.
Professional Support for Advisors
ASIC is the current regulator of professional advice for other asset classes and borrowing. Their professional standards for these groups are:
An appropriate educational qualification
Professional indemnity insurance for the service delivered, and,
Membership of a professional association.
PIAA has adopted these standards.
Education: PIAA developed a professional property investment advice course based around a business process that delivers transparent and professional advice to clients to help them make better investment decisions. The course is in its 5 year and has had great testimonials from participants from mortgage broking, accounting, financial planning, legal and property investment advice sectors.
Professional Indemnity Insurance: PIAA graduates can apply for a bespoke PI insurance policy for their advice component. This is vital to support recourse in the unlikely event of a client complaint. It also supports referring solicitors, financial planners, mortgage professionals and accountants cover the gap that has traditionally been unmanaged via referrals to selling agents.
Professional Association: PIAA became a professional association in June 2012. It provides regulatory, PI insurance and educational support for its members. Visit our website atwww.piaa.asn.au or call 02 9499 9499 to ask for your nearest advisor.
*FOFA: Future of Financial Advice