The Property Practitioners Act now just needs the president's signature to come into effect, and when it does it will bring about many significant changes in South Africa's property sector.
It will not only replace the Estate Agents Act, which has been in force since 1976, but will considerably broaden the scope of that legislation to cover commercial property brokers, bond originators, home inspectors, home owners’ associations, companies selling timeshare and fractional title, property developers and property managers as well as “traditional” estate agents.
The new legislation also defines a managing agent as anyone who collects or receives any money payable in respect of a leased property or business undertaking or who provides, procures, facilitates, secures or otherwise obtains or markets financing for or in connection with the management of leased properties.
Protection for landlords and tenants
Thus everyone who sets up in business to let and manage rental properties will now fall under the provisions of the new Act as regards trust accounts and the management of client’s deposits and monthly rentals, for example, and that means better protection for both landlords and tenants. All managing agents will also need to hold a valid Fidelity Fund Certificate (FFC) in order to claim commission on any new or renewed leases.
The Act also provides for a new Board of Authority to replace the current Estate Agency Affairs Board, as well as further protection for landlords, tenants and other consumers of property services in the form of a separate and independent Property Practitioners Ombud to deal with any complaints against property practitioners.
The new law allows for both mediation and adjudication as part of the process for dealing with such complaints, and this should help the Ombud’s office to resolve most matters quickly and efficiently. However, it is important to note that disputes between tenants and landlords will still need to be taken before the Rental Tribunal.
Other important provisions of the new legislation for landlords and tenants to note include the following:
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