PROPERTY BILL COULD BE LAW BY NEXT ELECTIONS
Category Property News
The wide encompassing definitions have stayed meaning that basically anyone involved in a property transaction are affected by the Bill
The ball is finally rolling to get the Property Practitioners Bill into law, possibly even before next year's elections in May. While some positive changes have been made, the Bill as it stands now still presents a wasted opportunity to effect real change in the property industry says Jan le Roux, CE of Rebosa.
The Portfolio Committee on Human Settlements on Tuesday 20 November provisionally adopted the Property Practitioners Bill. Next it will be debated in parliament on 4 December where after it will be referred to the National Council of Provinces this year still before being sent to the President for his approval.
It may well only require the President's signature next year and word is it is hoped to have him sign the Bill into law before next year's general elections in May.
IMPORTANT IN CURRENT BILL
According to a statement received from Le Roux the following is important for the property industry to take note off in the latest draft of the Bill - take note this is not final. It can still change.
Definitions: The wide encompassing definitions have stayed meaning that basically anyone involved in a property transaction are affected by the Bill - this includes mortgage originators and possibly even property portals. Valuators are however excluded.
Developers: Hard to understand but developers can still sell properties without having to comply with rules and regulations governing the property industry.
Attorneys: The Bill still allows attorneys to sell properties at a discounted rate and benefit from the conveyancing there of.
Supervision of interns: In the Bill principals are held responsible for wrongdoing by interns irrespective if they had any knowledge thereof or not. Currently principals are not held responsible if they had done everything reasonable to prevent the wrongful actions.
FIDELITY FUND CERTIFICATES:
* BEE certificate and tax clearance: No Fidelity Fund Certificate will be issued without proof of having a valid BEE certificate and a tax clearance certificate.
* Disqualification of directors and principals: Illegal/negligent behaviour by a director or principal will still lead to an entire company (including each individual agent in it's employ) being deregistered with the EAAB.
* Proof of registration: It will be illegal for conveyancers to pay commission to unregistered estate agents.
* FFC's will be valid for three years instead of the current one year.
Trust accounts: Agencies with a turnover of less than R2.5 million are allowed to have their accounting records reviewed by an accountant instead of audited. The Minister may allow certain agencies to operate without trust accounts.
Commenting on the current version of the Bill, Le Roux said that Rebosa welcomed some of the changes made such as the three year validity of the FFC, enforcing conveyancers to recognise proof of registration before paying commission to estate agents and some relaxation on trust accounts. The Transformation Fund and Property Sector Research Centre initiatives are also seen as positive by Rebosa.
Overall though Le Roux said Rebosa isn't satisfied and will continue to lobby for more changes to the Bill until the day it is signed by die President.
Leo Mlambo, president of the National Property Forum (NPF), said although they remain convinced that the property sector is the most untransformed, they appreciate the efforts by the government to open up jobs in the sector for all, especially the young disadvantaged in the country.
Specifically the NPF greatly welcomed that property practitioners will be able to register for a period of three years instead of yearly, "which is a welcome development as yearly registrations were an administrative nightmare" he said. They also welcomed the concessions granted to estate agencies with a turnover of less than R2.5 million as well as the establishment of a Transformation Fund and Property Sector Research Centre. Mlambo said they hope there will be consultation with all role-players regarding the centre.
The Centre for Affordable Housing in Africa (CAHF), a non-profit organisation, focused their inputs on how the Bill could open up the formal property market to historically-disadvantaged areas. Alison Tshangana, Head of Research and Market Intelligence at CAHF, said they therefore welcome the establishment of the research centre which would help to identify the barriers to entry and participation in the formal property sector by residents in these areas.
They also want to see that access to formal estate agents opens up for people in township areas without excluding and penalising informal estate agents already operating in these areas. Tshangana said the NPO sees the Transformation Fund playing a role towards this through sponsoring regularisation programmes thereby providing a pathway for informal agents to join the formal industry.
Lastly, the CAHF also welcomed the recent amendments towards exempting property practitioners with turnovers of less than R2.5 from the requirements of a formal audit and being allowed to apply for exemption towards keeping trust accounts.
More information as well as the current version of the Bill is available on rebosa.co.za. Email any questions or comments you may have on the bill to editor@propertyprofessional.co.za.
Author: PROPERTY PROFESSIONAL
