Slew of new property laws will have most dramatic effect on agencies and agents – experts

Slew of new property laws will have most dramatic effect on agencies and agents – experts


The Property Practitioners Act is set to change the industry “dramatically”. Other laws attorneys say will affect it include the proposed Housing Consumer Protection Bill, the Land Court Bill, and the Western Cape Government’s draft Inclusionary Housing Policy.

Once the Property Practitioners Act – which has been promulgated but is not yet gazetted – comes into effect, says Maryna Botha, director of STBB, it will have a fundamental effect on the industry because it repeals and replaces the whole of the Estate Agency Affairs Act, regulations and code of conduct.

“There is no singular further act that should have a bigger impact on this industry, except that the convergence of so many new laws, including the Protection of Personal Information Act (Popia), the Financial Intelligence Centre Act (Fica), and the Property Practitioners Act, substantially increases compliance responsibilities and makes running a business daily more demanding.”

He summarises the major changes:

• It will apply not only to estate agents and agencies but to all property practitioners which includes providers of bridging finance, bond originators, and conveyancers.

• The Estate Agency Affairs Board will be replaced by a board of authority, a body tasked with governing all property practitioners.

• No property practitioner will be entitled to any commission if they do not have a valid Fidelity Fund Certificate. • Property practitioners will be entitled to receive a commission from a property sale only upon registration of transfer and this cannot be contracted out of.

• All property sellers will be obliged to provide a snag list of any defects they are aware of in a property. If an agent sells a property without having obtained a snag list they can be held to be personally liable for the costs of rectifying any issues with the property.

Donald Mokgehle, the senior associate at Adams & Adams Attorneys, adds that a property practitioner is defined as any person who sells, by auction or otherwise, or markets, promotes or advertises any part, unit or section of, or rights or shares, including timeshare and fractional ownership, in a property or property development.

“The act creates the Property Practitioners Regulatory Authority (“the authority”) which will regulate the conduct of property practitioners when dealing with consumers.

“In line with the act’s objective to transform the property market in order to promote the expansion of property ownership among South Africans, the authority will also be responsible for providing adequate protection, education, and information to consumers.”

The Housing Consumer Protection Bill is also noteworthy, says Louis Kruger, director at Kruger Attorneys & Conveyancers. This bill, which was introduced to parliament in May, aims to replace the Housing Consumers Protection Measures Act, 1998, and to provide for:

• The protection of housing consumers.

• The continuance of the National Home Builders Registration Council as the National Home Building Regulatory Council.

• The registration of homebuilders.

• The enrolment of homes in order to be covered by the home warranty fund.

• The regulation of the conduct of homebuilders.

• The continuance of the home warranty fund.

• Claims against the fund.

• Funds of the council and for the management of those funds.

• Procurement and contractual matters in relation to the building of a home.

Meyer de Waal, director of MDW Inc, says one act that will bring “good-news changes”, is the Land Court Bill which was recently introduced to parliament.

This Bill aims to:

• Provide for the establishment of a Land Court and a Land Court of Appeal.

• Make provision for the administration and judicial functions of the Land Court and a Land Court of Appeal.

• Make provision for budgetary matters.

• Provide for the exclusive jurisdiction of the Land Court and Land Court of Appeal for certain matters.

• Provide mediation and arbitration procedures. • Amend certain laws relating to the adjudication of land matters by other courts. De Waal adds that the “big talk of the town”, for those in the Western Cape, is the provincial government’s proposed Inclusionary Housing Policy.

“It requires the government, in its spatial plans, to address historical and spatial imbalances. It also specifically requires a municipality to designate areas where a national or provincial inclusionary housing policy may apply, in its municipal spatial development framework.”

The document states: “Our settlements are plagued by the social and economic divisions of our apartheid past. “Land markets and state-assisted housing programmes, with limited funds and pressure to deliver, continue these patterns. “Areas that are well served by public facilities and amenities and have easy access to employment opportunities are expensive and it is difficult for many households to afford to live in these areas.

“Instead, these households find affordable housing opportunities in areas further away and a lot of time and money is spent travelling to school, work, hospitals; etc. This makes it difficult for these households to advance themselves (as) all their spare time and money is lost to long travel times.

“Households that have managed to stay in well-located areas find themselves pushed out as development interest in an area grows, land values (and resulting taxes) and rents rise and become unaffordable.”

The document notes inclusionary housing is “one way to provide affordable housing opportunities in well-located areas partnering with the private sector and using the public sector’s contribution to the value of the land in these areas”.

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