ESTATE AGENTS BEWARE! PROPERTY PRACTITIONERS BILL IS COMING

 

 

ESTATE AGENTS BEWARE! PROPERTY PRACTITIONERS BILL IS COMING.

Estate Agents need to be aware that on 31 March 2017, the Human Settlement committee gazetted for comment the Property Practitioners Bill which is set to replace the Estate Agency Affairs Act. The Bill is getting some momentum and there seems to be no doubt that it will be passed into law. What the Bill aims to do is to transform the property market and provide good regulatory mechanisms.

One of the big changes the Bill has presented is the definition of a property practitioner. The Bill has used the expanded term property practitioner to cover the wide range of people involved in the property business. The Bill includes estate agents, bond brokers, property valuators, home inspectors, property managers and developers in its definition of a property practitioner. The Bill will therefore apply to all the property practitioners as defined in it.

The Bill introduces as one of its new features a new regulatory body which will be replacing the Estate Agency Affairs Board established by the current Act. The Bill refers to this body as Property Practitioners Regulatory Authority and it will regulate the conduct of all property practitioners. The Bill further establishes a Property Practitioners Ombuds Office which will consider and provide resolution mechanisms to complaints brought forward by the public against property practitioners.

One of the major concerns with regard to the Bill is the extended powers of inspectors. The Authority are given the powers to appoint inspectors who will go around and determine whether the practitioner has complied with the rules. It appears that the Bill confers on inspectors the power to enter the premises of the property practitioner who has not complied with the Act and to seize and retain or seize documents without a warrant.

Property practitioners are still required to hold and have a valid Fidelity Fund Certificate before they can earn commission for their estate agency services. The Bill goes on further to state that commission earned by a property practitioner who is without a valid Fidelity Fund Certificate must be refunded, on demand, to the payer thereof.

In terms of disqualification from obtaining a Fidelity Fund Certificate, the Bill has basically retained all the requirements of the current Act and added a few like requirements having a valid BEE certificate and a tax clearance certificate.

In terms of the Bill, property practitioners are required to keep records and any other important documents for a period of 10 years. Further to that, a seller would need to furnish the property practitioner with a mandatory discloser form before the property practitioner may take a mandate.

The Bill goes on to list further requirements in respect of the property practice and it is quite important for every property practitioner to know them so as to avoid getting on the wrong side of the law. There are some exemptions that have been introduced which you will need to consult an attorney in respect of and to find out if they apply to you.

 

For more information, contact Charmaine Schwenn

charmaine@schwenninc.co.za

www.schwenninc.co.za

031-0030630 / 083 789 7638