Auctioneers and estate agents are earning "huge fees" that are out of proportion with the amount of work done for their clients, the Director of Consumer Affairs, Ms Carmel Foley, has said.
The massive inflation in house prices meant that agents, who charge clients a percentage of the sale price, were earning unjustifiably large sums, she said.
"I can't see why fees are based on a percentage of the sale price. Fees should be based on an estimate of the amount of work needed or by the hour, or type of transaction. If a house is sold for €10 million as opposed to €1 million, why should they get 10 times the amount of money? Don't tell me they've done 10 times the work."
The Office of the Director of Consumer Affairs (ODCA) is represented in the new working group set up by the Minister for Justice, Mr McDowell, to review practice and regulation within he auctioneering industry.
The biggest grievance of buyers with the industry was inaccurate guide prices, she said, where the sale price was sometimes double the published guide. However, they also experienced problems in the way estate agents described properties, particularly in terms of square footage and garden boundaries. "People need to be able to rely on the particulars as described to them, but sometimes they don't get all the details they would expect."
Ms Foley would like to see an end to the practice whereby each potential buyer has their own survey done. "I would like to see the law provide for the seller to get one survey done which everyone would have access to, which I gather is the practice in France."
Buyers were also "uneasy" about the possibility of "ghost bidders", she said. "There needs to be a way of restoring confidence in the process - that if people are told there are counter offers, that there are genuine counter offers."
Mr Dermot Jewell of the Consumers' Association, which is also represented, said he would call for advertisements and plans to be clearer for consumers to understand. The association regularly received complaints about inaccurate guide prices and inflated estate agent's fees.
Agents are legally bound to get the best price for their clients, said Mr Alan Cooke, chief executive of the Irish Auctioneers and Valuers Institute (IAVI).
"Certain groups would ask auctioneers to go against the interests of their clients. I'm not saying that changes aren't needed, but we can't look at it in isolation from the law."
Currently, the only qualifications necessary to gain a licence were that the applicant was over 18, not an undischarged bankrupt and had €12,700 to lodge with the District Court. Formal qualifications were necessary for IAVI membership, but were not currently a statutory requirement, he said.
The working group is chaired by Mr Alan McCarthy, former chief executive of An Bord Trachtála.
Other members include: Mr Alan Cooke, IAVI; Mr Liam O'Donnell, Institute of Professional Auctioneers and Valuers; Mr Thomas Flanagan, Irish Co-operative Organisation Society Ltd; Mr Pat Davitt, Mullingar Chamber of Commerce; the Consumers' Association of Ireland; the ODCA; Irish Farmers' Association; and the Departments of Justice; Enterprise, Trade and Employment; Environment; and Agriculture and Food.
