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Speaking exclusively at the REB webcast, titled Trust Accounting to Secure Digital Payments – Is this the Future for Property Management?, Managed commercial director Alex Whitlock has highlighted the alignment between the objectives of Managed and Fair Trading.
Eradicating fraud, theft and misappropriation are core objectives of the Managed platform, aligning it with regulators and other stakeholders that are seeking to strengthen the property management sector, Managed’s commercial director Alex Whitlock has said.
Whitlock was one of the four panellists who discussed the future of real estate payments on a recent REB webcast, and why agents are increasingly looking for an alternative to using a trust account.
One of the questions raised by webcast moderator and managing editor of real estate at Momentum Media, Liam Garman, was the impact of trust account misappropriation on the reputation of the industry
“I don’t really want to get into the challenges around running a trust account,” Whitlock said.
“There are obviously tens of thousands of agents that run trust accounts in an ethical and compliant manner. Unfortunately, however, the actions of a few do taint the majority – but I want to step away from that.
According to Whitlock, it’s more a matter of looking at payments as a whole.
Through the advances of technology, there is now a better, cleaner and more simple way to transact, he said.
“I just think there’s a wonderful opportunity to look beyond what has been the mainstay of property management for the last 80-odd years. Trust accounting has been around for a long, long time.
“There’s just a better way now. We [Managed] are transparent, our platform can be audited, it can [also] be viewed by those that govern and regulate property management transactions.
“We’re looking at an ecosystem of tenants, property managers, owners and also tradespeople. We have taken the opportunity to bring the whole ecosystem together to build a transparent, simple system with no manual reconciliations.
“We are on the same side as Fair Trading – we want to eradicate fraud, we want to eradicate theft and misappropriation.”
In bringing together leaders across real estate payments in its latest webcast, REB set out to understand how and why agents have chosen an alternative to using a trust account.
But while a growing number have switched, or plan to move to automated payments, many agents still have concerns whether it is compliant.
Rohith George, Managed’s COO and webcast panellist, revealed that agents who use Managed cannot access client funds.
Each tenant is connected directly to the respective owner – and only they have access to their own “wallets”, he said.
“The bottom line is that agents don’t handle any money, and so they don’t need to hold a trust account.
“With platforms like Managed, no agent ever handles money. It is direct from tenant to landlord. All the agent receives is their fee,” he said.
In addition to compliance concerns, another common theme from participants’ questions during the webcast centred around the challenges attracting new entrants to the property management sector, and the role of new technology to smooth out many of the often frustrating manual tasks.
Whitlock was quick to praise property managers and the value they bring to both owners and renters, however he warned that the manual payments and reconciliations – as well as the stress around trust accounting – was a barrier to attracting new talent to the profession.
“This is an important issue. The reason that I’m here is because I’m an investor, I’m an owner, and I’ve always used property managers.
“Every property manager that I have ever dealt with have always been extremely hardworking, conscientious and outcomes-focused for me as an owner, but also for the tenant as well.
“It’s a tough industry and I think there is an unnecessary burden and responsibility; I would imagine stress around [the] management of money that is probably holding younger people from coming into this industry,” he said.
“And I think people coming to property management care a great deal about people, but I think there’s a barrier with unnecessary administration.
“So, one of the things that we [Managed] are going to do is to work very hard to promote the benefits of working in an agency where you can do the things that you want to do, working with owners and working with renters, and facilitating a better renting experience when payments are automated.”
“I think this is the way to help attract new blood into the industry,” he said.
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