Posted by Swellengram

Property Practitioners Act (PPA)

  • Posted 12 months ago
  • Uncategorized

As of 1 February 2022, the new Property Practitioners Act (PPA) has officially commenced

According to Tony Clarke, chairman of the Real Estate Business Owners of South Africa (Rebosa), this is a welcome step in the right direction for an industry previously plagued by unclear and often poorly implemented legislation.

“The PPA clears up a lot of the grey areas in the previous legislation. We’re really looking forward to the clarity it brings, along with the additional protection it gives consumers by formally legislating processes that we’ve considered best practice for some time.”


Some of the key changes being introduced by the new Act:

Disclosure 

Now-compulsory inclusion of a comprehensive property defects disclosure document for both property sales and rentals.

Under the PPA it will be officially illegal to accept a mandate from a seller or a landlord without receiving a comprehensive disclosure document first.

This document must be signed by all parties and attached to the sale or lease agreement.


Certification

Any business earning a commission or brokerage from the sale or lease of a property must hold a valid Fidelity Fund Certificate (FFC), tax clearance and BBE certificates.

New FFCs will be valid for a period of three years instead of one. Fees have also been standardised across all professional levels.

FFCs will no longer be linked to a specific employment position. Certificates will now remain valid if an agent progresses to principal or changes employers.


Trust accounts

From now on property practitioners only need a trust account if they actually handle trust monies., Using a dedicated third-party payment processing agent or intermediary with their own compliant trust account is acceptable. An exemption application is a prerequisite to not having a trust account.


Training

Prospective agents can study and sit their Professional Designation Examination (PDE) before joining an agency. Once the PDE is passed , selling property can begin in less than six months – under supervision – pending completion of a further six practical course modules.”


Transformation

Better support for agents is at the heart of changes to the Transformation Fund, too. It will be run by an independent body appointed by the PPRA.

Training, development, and financial support is being made available to existing historically disadvantaged property practitioners.


Equal opportunity 

Small businesses may also soon be tapping into new opportunities within security estates and other developments due to the PPA’s abolition of the practice of charging real estate agents ‘accreditation fees’ in return for exclusive rights to property transactions within a development.

Sellers and landlords within estates will no longer be limited to their development’s approved agents giving all businesses – large and small – a fair chance to win mandates based on the quality of their service.

Developers will also no longer be able to sell their own properties without registering as a property practitioner, providing more opportunities for real estate agencies to provide this service.

DOWNLOAD OR READ THE ACT HERE

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