Prop­erty bill misses the point

Tech­ni­cal de­fi­cien­cies, short­com­ings and er­rors in bill, writes Jan le Roux

CityPress - - Voices -

The Na­tional As­sem­bly unan­i­mously passed the Prop­erty Prac­ti­tion­ers’ Bill on Tues­day. The bill, which will now go to the Na­tional Coun­cil of Prov­inces early next year, will os­ten­si­bly de­liver trans­for­ma­tion of the real estate in­dus­try be­fore next year’s elec­tions.

No­tably, it passed unan­i­mously with op­po­si­tion par­ties in sup­port.

If the cre­ation of a trans­for­ma­tion fund and en­force­ment of the prop­erty char­ter was in­cluded, this might have worked.

Des­ig­na­tions have been changed from estate agent to prop­erty prac­ti­tioner and from Estate Agency Af­fairs Board to the “Au­thor­ity”.

The wide en­com­pass­ing def­i­ni­tions ensure that any­one re­motely as­so­ci­ated with prop­erty trans­ac­tions will be af­fected by the bill, from mort­gage orig­i­na­tors (prop­erty fi­nance) to prop­erty por­tals and prop­erty papers (ad­ver­tis­ing).

This sad­dles the Au­thor­ity with sig­nif­i­cantly more re­spon­si­bil­ity while it is al­ready com­mon cause that it breaks records in bad ser­vice de­liv­ery, not to men­tion on­go­ing IT chal­lenges.

Un­for­tu­nately, prop­erty de­vel­op­ers can still sell their prop­er­ties to con­sumers with­out hav­ing to com­ply with the reg­u­la­tions with which all estate agents have to com­ply, deny­ing cus­tomers the pro­tec­tion ren­dered by the Fidelity Fund.

At­tor­neys are still ex­empted to do what they have been do­ing lately – to em­ploy staff to sell prop­er­ties at “dis­counted” rates and ben­e­fit from the con­veyanc­ing de­rived by the sale.

BE­WARE

Un­sus­pect­ing agents could still wake up to find their Fidelity Fund Cer­tifi­cate – li­cence to trade – and that of the en­tire com­pany can­celled be­cause of a sim­ple omis­sion of one of the di­rec­tors or prin­ci­pals – thereby for­feit­ing their com­mis­sion for months.

Dor­mant trust ac­counts re­main an un­nec­es­sary re­quire­ment at huge ex­pense, as do com­pul­sory au­dits of busi­ness ac­counts (in­stead of more af­ford­able au­dit re­views).

As many as 4 500 trust ac­counts out of 6 000 may be dor­mant.

There is no mo­ti­va­tion for all estate agents to have trust ac­counts.

More em­pha­sis on ease of com­pli­ance, costs, ef­fi­ciency of the Au­thor­ity, stream­lin­ing of pro­cesses and fo­cus would have gone a long way to­wards pro­mot­ing trans­for­ma­tion.

New en­trants to the in­dus­try, mostly black to trans­form the in­dus­try, will still find it tough to get out of the start­ing blocks.

The big na­tional real estate agency groups with ex­ist­ing in­fra­struc­ture and re­sources will ben­e­fit at the ex­pense of new black en­trants.

None of the political par­ties has any ex­cuse for this mostly un­for­tu­nate bill as they were well ad­vised – in great de­tail – about the tech­ni­cal de­fi­cien­cies, short­com­ings and er­rors in it.

So much for a “crit­i­cal” op­po­si­tion. How­ever, some good has come out of it: The in­ten­tion to fo­cus on trans­for­ma­tion is laud­able and will be sup­ported. Fidelity Fund Cer­tifi­cates re­main valid for three years. Con­veyancers will be con­tra­ven­ing the bill should pay­ment of com­mis­sion be made to un­reg­is­tered “prop­erty prac­ti­tion­ers”. This will help to com­bat the is­sue of il­le­gal estate agents. Le Roux is chief ex­ec­u­tive of Real Estate Busi­ness

Own­ers, a non-profit com­pany

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