The Property Practitioners Act, which is due to be signed by President Ramaphosa, marks the most significant change in property legislation seen in recent decades. The new law, which will replace the Apartheid-era Estate Agents Act of 1976, aims to regulate the property industry and offer greater legal protection to property owners and tenants alike.
Let’s take a look at a few of the main changes that the Property Practitioners Act will bring about in the commercial property sector.
A wider scope and better safeguards
For property professionals, the Property Practitioners Act’s fine print will mean increased compliance requirements and a commitment to serving the needs of landlords and tenants equally.
The law will also apply to practically everyone who is involved in the sale and renting of residential and commercial property in South Africa.
That includes bond originators, property developers, home inspectors, homeowners’ associations and timeshare companies, as well as any “managing agent” who collects or receives funds in respect of leased property or management of said properties.
- Any professional who falls under the new Act will need to have a valid Fidelity Fund Certificate (FFC) before they can offer their services to the public.
- What’s more, every agent and associate in a firm will need to have a valid FFC before the firm can receive any commissions. BEE certificates may also be required in some circumstances.
- Sale agreements will need to be made available in all of South Africa’s official languages, as a client now has the right to insist on a sale agreement in their language of choice.
- The Estate Agency Affairs Board (EAAB), which currently regulates the real estate sector in South Africa, will be replaced by a new Board of Authority once the new law is implemented.
Owners beware: full defects disclosure is now necessary
For property owners, one of the most important aspects of the new law is the requirement that no sale will go through without a declaration form listing all property defects.
If the owner of a property is aware of any defects, they will need to declare these, and the agent will attach their declaration to the sale agreement. Failure to comply could render the sale null and void.
Ensure a 100% legal sale with trusted commercial property professionals
When asked to give his thoughts on the new Property Practitioners Act and just what it will mean for commercial property professionals, Robbie Morris, Head of Commercial at Commercial Space had this to say; “I think it’s great for the industry as it promotes competency from all parties involved, in both sides of a transaction”. At Commercial Space, we ensure that our team is 100% legally compliant and up to date with the latest property laws. If you have any questions, feel free to contact us today.