AI Cold Callers, Sign Wars and Strata Kickbacks

Kasey McDonald: Well, welcome to Before the Weekend, your go-to real estate podcast where we cut through the noise and deliver what truly matters. I'm Kasey McDonald, and I'm here with my fabulous co-host, Pete. How are you today?

Peter Schravemade: Yeah, well, always good. It's a Friday, and like everyone else, I'm looking forward to the weekend. How was your week? Where are you today?

Kasey McDonald: I'm actually in Sydney this week. As part of my new role, I've been out seeing customers, meeting partners, and catching up with people who have integrations with us. There's still plenty to learn, but it's been a lot of fun. What about you?

Peter Schravemade: Outstanding. I'm actually at home this week. Last week was huge, but this week I haven't travelled at all. I'm still flooded with work, but at least I'm doing it from home and enjoying the beautiful Queensland weather, just to rub it in a little bit down there in Sydney.

We've got an interesting week of industry news to discuss. Unfortunately, I can't say it's been a flattering week for real estate, but it's certainly worth talking about. One article that crossed my desk came from the ABC and involves a prospective purchaser who was repeatedly cold-called by an AI agent named Daniel. Have you seen that one, Kasey?

Kasey McDonald: Yes, I did see it pop up.

Peter Schravemade: The premise is that Daniel introduced himself as a Colliers real estate agent reaching out to prospective buyers. The interesting part is that the purchaser wasn't particularly impressed. More interestingly, Colliers themselves seem to have gone quiet on the issue. No one really knows whether this was an official Colliers initiative, an individual agent experimenting with technology, or something else entirely. We've heard plenty about AI voice calling in real estate. What's your take?

Kasey McDonald: I don't think it's uncommon anymore. We already see AI being used in SMS communication and other automated customer engagement tools. Looking at the article, Daniel was asking fairly standard buyer qualification questions about what type of apartment the purchaser was looking for. What I found amusing was that the purchaser started asking Daniel questions like, "Are you an actual person?" The way Daniel responded was pretty interesting.

Peter Schravemade: I've heard of this happening quite a bit, and I think we're only going to see more of it as agents search for ways to generate more leads. At the end of the day, that's really what this is about. A good friend of the podcast, Antonia Mercorella, made the point that the law is still catching up to the technology. My view is that the line gets crossed if artificial intelligence starts misrepresenting a property or a transaction. If an AI tool says something inaccurate about a property, a tenancy, or a sale process, I imagine the agent would still be responsible. When you think about it, AI is simply another tool. We already have AI-generated emails, AI-generated text messages, and AI-generated content. Much of the correspondence being created today is assisted by artificial intelligence. The risk comes when something is misrepresented. So the question becomes: has anyone actually broken the law here?

Kasey McDonald: I don't think so. This was essentially a buyer enquiry conversation. Daniel was asking standard qualifying questions. There doesn't appear to have been any misrepresentation of a property. The issue isn't necessarily what Daniel said. The issue is that Daniel wasn't introduced as an AI at the start of the conversation. That's probably where the transparency should have come in.

Peter Schravemade: Exactly. Have you ever called my voicemail?

Kasey McDonald: No, I don't think I have.

Peter Schravemade: My voicemail is actually handled by an AI assistant called Lucy. She introduces herself immediately. She says: "Hi, my name is Lucy. I'm an AI assistant taking messages on behalf of Peter." Then she collects the information and sends me a summary via text message. Lucy has saved me hours of listening to voicemail messages. I've had very mixed reactions. Some people absolutely love it and want to know where they can get it. Others hate it and tell me they don't want to talk to a robot.

Kasey McDonald: I think that's exactly the lesson here. You've disclosed it. People know who Lucy is. People know she's an AI. That's probably the difference.

Peter Schravemade: I agree. There is definitely a trust component. What happens if Daniel starts making representations about a property that aren't accurate? What happens if Daniel starts describing a burnt-out house as a luxury home? That's where things become problematic. I think Antonia is probably right. There's a grey area in the law at the moment. The real issue comes back to transparency and whether anything has been misrepresented. That's likely where regulators would focus their attention. And I suspect this won't be the last story we see involving AI in real estate.

Peter Schravemade: Let's move on because we've got a whole list of stories to get through. I deliberately try not to get involved in agent spats, but there's one going down in Brisbane at the moment that's attracted a fair bit of attention. We've seen similar things before. My good mate Brett Andreessen was involved in a very public dispute last year where fake profiles had allegedly been created using his name and search engine optimisation tactics. From time to time these stories pop up, and unfortunately they're usually a bit of a black eye for the industry. This latest one involves a dispute between two agencies. I'm not going to name the other party involved because, quite frankly, we don't know exactly what's happened. What we do know is that a Logan agent, Sona Khehra, went live on social media after claiming several of her directional signs had gone missing. Her solution was actually quite clever. She started putting Apple AirTags inside the signs. According to her, the signs then started appearing either inside, or in bins outside, a competing real estate office. Now, I suppose it's possible that it's all a coincidence. It's possible somebody is trying to stir trouble between the agencies. But it certainly created a lot of attention. Rather than making a formal complaint, she went live on social media and essentially said, "If anyone needed signs, I would have happily bought them some." I understand the humour in it, but I also think there was probably a more professional way to handle it. A quiet conversation between principals may have achieved a better outcome than taking it public. What's your take on it, Kasey? Have you ever stolen a sign?

Kasey McDonald: No. I've definitely had signs vandalised. I've had things drawn on them over the years, but I've never had one stolen. And to your point, we're adults. I don't really know why it needed to become a public issue. I even saw coverage appearing in major media publications. At that point you start wondering whether it was simply a slow news day. The bigger issue is that social media can either build your reputation or damage it. We're certainly not talking about this story because it's helping anyone secure their next listing. We're talking about it because it became public and created negative attention. At the end of the day, she's accusing someone of foul play.

Peter Schravemade: That's the thing. She's accusing someone, but she doesn't actually know who the person is. The signs were found in a bin. That doesn't automatically mean anyone from that office put them there. It could have been an employee. It could have been a member of the public. It could have been someone trying to cause trouble between the two agencies. We simply don't know.

Kasey McDonald: Exactly. Someone could have collected them and dumped them there. Now every teenager in Logan knows exactly what to do if they want to stir up trouble. They just need to put signs in another agency's bin.

Peter Schravemade: Exactly. And suddenly every agency in Logan is wondering where their directional signs have gone. I think we can probably leave that one where it is.

Kasey McDonald: Absolutely. In the bin.

Peter Schravemade: Speaking of more serious issues, another story that emerged this week involves a contractor and one of Australia's larger strata management businesses. For those unfamiliar with the sector, strata managers and facilities managers often oversee large apartment complexes and major maintenance programs. Some of these organisations effectively manage portfolios containing thousands of apartments. According to reports, a contractor was discussing a significant project with a representative from a large strata organisation. The allegation is that the contractor was asked what sort of financial benefit or percentage payment would be provided in return for securing the work. In other words, what many people would describe as a kickback. Now, not only could that raise legal issues, but it also raises serious questions about governance and transparency. What's particularly striking is how openly it was allegedly discussed. The suggestion appeared to be that if you wanted the work, there needed to be something in it for the person awarding the contract. You've spent decades in property management. Have you ever experienced anything like that?

Kasey McDonald: Not personally. In twenty-seven years I've never had a contractor offer me money in exchange for work. The relationships I've built with tradespeople have always been based on three things: quality of work, speed of service, and competitive pricing. At the end of the day, the owner still chooses who they want to use. As agencies we might recommend contractors we trust, but owners have every right to engage someone else.

Peter Schravemade: And I think that's where the difference lies. In residential property management, owners generally make the final decision. In large strata environments, the decision-making process can be different. You might be talking about a pool contract, lift maintenance contract, cleaning contract, or major capital works project. The question becomes: are the quotes being compared purely on merit? Or are there other incentives influencing the recommendation? I'm certainly not suggesting every strata manager operates this way. But when I spoke to people familiar with the sector, several indicated that referral arrangements and contractor relationships are not uncommon.

Kasey McDonald: I've definitely seen situations in strata where the recommendation becomes: "That's the contractor we use." And the discussion ends there. Owners don't necessarily challenge it because they assume the recommendation is in their best interests.

Peter Schravemade: That's what concerns me. The Victorian Government has already signalled that it's considering stronger disclosure requirements and harsher penalties where conflicts of interest aren't properly disclosed. I understand the need for centralised decision-making. The last thing you want is fifty apartment owners each hiring their own contractor for the same job. But there needs to be transparency. People need confidence that recommendations are being made because they're the best option, not because they're the most financially rewarding option for someone behind the scenes. I've sat on body corporate committees where ninety-five percent of owners simply wanted the building to run smoothly and didn't pay much attention to what was happening. That's fine, until something goes wrong. And stories like this remind everyone why governance matters. Because if even a small percentage of these allegations are true, it raises some very serious questions about how contracts are being awarded in large residential buildings.

Kasey McDonald: Actually, Peter, that discussion around contractors and maintenance probably leads nicely into another article that came out this week. This one involved a New South Wales property manager who was sentenced after misappropriating trust account funds. What stood out to me was that we're once again talking about trust, accountability and misuse of client money. The reports suggest the property manager was involved in around 162 fraudulent transactions and had established multiple personal bank accounts to divert funds. We're talking about money that should have been going to landlords, contractors or trust accounts instead being redirected elsewhere. The sentence was a twelve-month community corrections order. Again, it raises the question: are we going hard enough when these things occur? Because ultimately we're talking about people's money.

Peter Schravemade: I've actually lived through something very similar as a principal. We had a rogue property manager operating under our licence. The first sign something wasn't right came from a tenant who was adamant they'd left a property spotless at the end of their tenancy. The property manager insisted a bond clean had been required and had charged accordingly. At first there didn't appear to be anything unusual. Then another complaint came in. Then another. Then questions started emerging about missing furniture and unexplained cleaning charges. Eventually we realised there were cleaning invoices being generated from businesses that didn't appear to exist. We started digging deeper and discovered fake entities had been created. As a company we had to go back through the files, identify affected parties and reimburse tenants and landlords where appropriate. It was a horrible process. We reported everything to the authorities, but it was a powerful lesson. Sometimes these things sit hidden for quite some time before they come to light.

Kasey McDonald: And unfortunately I've seen similar things during due diligence reviews on rent rolls. You start tracing invoices and payments and suddenly realise things don't add up. In some cases fake contractors have been created. In others, invoices have been inflated or manipulated. What's frightening is that principals are often completely unaware. They trust the systems, they trust the processes, and they trust their staff. The reports from New South Wales indicate this individual admitted to creating multiple bank accounts and redirecting funds. The money wasn't being spent on luxury homes or expensive cars either. It was everyday spending. Food. Trips to the pub. Hair appointments. Holidays. Small amounts taken consistently over time.

Peter Schravemade: That's often the pattern. It's rarely some grand criminal enterprise. It's usually someone justifying small amounts until it escalates into something much larger. The thing that strikes me is that every regulator seems to draw a very firm line when it comes to trust accounts. There are lots of issues in real estate that might result in warnings, fines or disciplinary action. But when someone misappropriates trust money, regulators tend to come down very hard. And rightly so. Because trust accounts sit at the heart of the entire system. If consumers lose confidence that their deposits, rental income or client funds are being handled correctly, the damage to the industry is enormous.

Kasey McDonald: Absolutely. And that's why these stories continue to attract attention. They're not just administrative mistakes. They're breaches of trust. And trust is everything in property management.

Peter Schravemade: Speaking of trust accounts, another story out of Victoria this week involved a fairly prominent agent who was fined after pleading guilty to trading without a licence and mishandling approximately $300,000 in client funds. What's interesting about this one is that there doesn't appear to have been any allegation of theft. This wasn't someone taking money for personal gain. Instead, the explanation seems to be that the agent didn't properly separate trust funds from operating funds. For those unfamiliar with the industry, any money that doesn't belong to the agency must be held separately. That means deposits, rental income and client funds are held in a trust account. They cannot be mixed with general business operating funds. It's one of the most fundamental principles of running a real estate business.

Kasey McDonald: Which is exactly why I struggle with the explanation. Trust accounting is covered during licensing. It's covered in training. It's discussed by regulators. It's available on government websites. I'm not saying people can't make mistakes. But this is one of the most basic concepts in agency operations.

Peter Schravemade: I don't know. Part of me wonders whether the quality of training has changed significantly over time. When I completed my licensing pathway it took much longer than it does today. There were practical assessments. Written submissions. Resubmissions if you got something wrong. People genuinely failed. Today, many licences can be obtained far more quickly. And I do wonder whether that has contributed to knowledge gaps within the industry.

Kasey McDonald: Training has definitely changed. When many of us entered the industry, there was far more practical assessment involved. Today much of it can be completed online. That's not necessarily a criticism, but it does create different learning experiences. Having said that, trust accounting is still a major component. Which is why I find it difficult to accept that someone operating an agency didn't know there needed to be separate accounts.

Peter Schravemade: The thing that makes me wonder is that he didn't actually need to hold trust money himself. Many agencies choose to use solicitor trust accounts or other arrangements. If that's available, why would someone intentionally put themselves at risk? That's why part of me genuinely believes ignorance may have played a role. Not that ignorance is an excuse. But it may explain how it happened.

Kasey McDonald: Maybe he should have asked Daniel. Or Lucy.

Peter Schravemade: Exactly. Maybe AI could have helped him with compliance. Although I suspect that defence wouldn't stand up particularly well in front of the regulator. What these stories really highlight is the importance of understanding your obligations. Because whether the issue is fraud or simple non-compliance, the consequences can be significant. And once trust accounts become involved, regulators tend to take a very dim view of mistakes.

Peter Schravemade: There's another story that crossed my desk this week, courtesy of A Current Affair. I always get a little nervous when A Current Affair runs what feels like a hit piece because often the full story sits somewhere in the middle. This particular case involved two women who purchased a property in Melbourne and later discovered significant structural issues beneath the house. From what I could gather, the property had experienced previous issues with its footings and subfloor structure. There had been remedial works completed and documentation supplied to support those works. The problem is that the purchasers appear to have relied on documentation provided rather than obtaining their own independent inspection. Now they're facing substantial repair costs and understandably feel aggrieved. The previous owner appears to have believed the issue had been rectified. The selling agent appears to have believed the issue had been rectified. The buyers believe they inherited a problem that wasn't properly disclosed. It's a mess. My takeaway is pretty simple. If you're buying a property, particularly an older property, get your own independent building and pest inspection. Don't rely solely on reports provided by somebody else. Would you agree?

Kasey McDonald: Absolutely. What stood out to me was that the documentation supplied was actually described as a statement of works, not a building inspection report. That's a very important distinction. The purchasers had the opportunity to obtain their own inspection or seek further information. As disappointing as the outcome is, due diligence remains a critical part of the buying process. Buying property is one of the biggest financial decisions most people will ever make. It's worth spending the money to have an independent expert review it.

Peter Schravemade: I genuinely feel sorry for them. There's no question they're facing a difficult situation. But unfortunately there are certain risks that come with property ownership. And inspections are designed to minimise those risks.

Kasey McDonald: On a more market-focused topic, another article this week reported that the Gold Coast has now overtaken Sydney in terms of median weekly house rents. The median house rent is reportedly sitting around $900 per week, while apartments are now around the low $800s. There are still pockets that remain more affordable, but broadly speaking the Gold Coast continues to become one of Australia's most expensive rental markets. For me, this comes back to supply and lifestyle. People want to live there. The beaches, the climate and the lifestyle continue to attract residents from all over the country.

Peter Schravemade: I can actually speak to this one directly. My daughter lives on the Gold Coast and what I've found fascinating is that there is still a distinction between rental shortages and rental preferences. She's leasing a property where rooms have occasionally sat vacant despite being close to Griffith University and major transport routes. What we've discovered is that many people don't simply want to live on the Gold Coast. They want to live on the glitter strip. They want to live in Burleigh, Broadbeach, Surfers Paradise and Southport. The closer you get to that coastal lifestyle, the stronger the demand becomes. So while affordability is a genuine issue, consumer preferences also play a role. People are willing to pay a premium for convenience and lifestyle.

Kasey McDonald: And that's exactly what's driving those rental prices. The challenge becomes how long renters can continue absorbing those increases. At some point affordability has to become part of the conversation.

Peter Schravemade: Another story this week involved a landlord who lost the ability to recover costs for damage allegedly caused by a tenant's cat. The details are less important than the lesson. The landlord missed the opportunity to pursue compensation because the required tribunal application wasn't lodged within the relevant timeframe. The landlord argued the property manager should have done more. The property manager argued they couldn't act without instructions. And ultimately the claim was lost. To me, the lesson is that appointing a property manager doesn't remove all responsibility from the owner. You still need to remain engaged. You still need to provide instructions. And when legal action is involved, you need to understand what's happening.

Kasey McDonald: Exactly. Property managers can't simply make decisions on behalf of owners in every circumstance. We often need specific instructions before proceeding. The agency in this case appears to have requested direction, but without those instructions they couldn't move forward. Unfortunately, by the time action was taken, the deadline had passed. It's a timely reminder that landlords still need to be actively involved in major decisions affecting their investment.

Peter Schravemade: Before we wrap up, I want to touch briefly on something we've discussed throughout several episodes now. Another article emerged this week involving serious allegations against a real estate professional. We're deliberately not discussing the details. The courts will deal with that. What frustrates me is that every time one of these stories emerges, the entire industry suffers. Consumers lose confidence. Agents become defensive. And thousands of hardworking professionals get unfairly painted with the same brush.

Kasey McDonald: I think that's the key point. The overwhelming majority of people in this industry are good people doing good work. Unfortunately, negative stories travel much faster than positive ones. When allegations emerge, social media amplifies them immediately. And regardless of the eventual outcome, reputational damage is often already done.

Peter Schravemade: Exactly. I'm not suggesting people shouldn't be held accountable. Far from it. But we should also be mindful of how quickly these stories are shared and celebrated, particularly when they involve competitors. No one really wins. The industry doesn't win. Consumers don't win. And often the facts aren't fully known when the sharing begins.

Peter Schravemade: Before we finish, I want to mention an upcoming Quick Bite episode featuring Ines Hegedus-Garcia, who is joining us in Australia for REIQ LIFT. Ines is one of the most respected leaders in American real estate. She's an architect, a practising REALTOR, a technology advocate and a former leader within Miami REALTORS, one of the largest real estate associations in the world. We had a fantastic conversation about leadership, innovation and the future of real estate. So keep an eye out for that episode dropping soon.

Kasey McDonald: Despite some of the challenging headlines this week, I think it's important to remember that there are still plenty of great people doing great work across the industry. Next week I'll be catching up with Arvi Khan from Ray White AKG. We'll be talking about leadership, market conditions, family life and what it takes to run one of Australia's largest agencies. So we've got some great conversations coming up.

Peter Schravemade: And for me, I'm holding onto something Tim Lawless told us last week. The professionals who consistently show up, do the work, serve their clients and focus on the fundamentals will be the ones who succeed over the next few years. Markets change. Technology changes. But professionalism still matters. To everyone conducting auctions, open homes, property management inspections and negotiations this weekend, thank you for representing our profession. And to our listeners, thank you for joining us for another episode of Before the Weekend. You can find us wherever you listen to podcasts, or visit beforetheweekend.com. Until next time, have a fantastic weekend.

Kasey McDonald: Thanks everyone. Have an awesome weekend.

Peter Schravemade: Have a great weekend. Ciao.