How the new Property Practitioners Act (PPA) affects you
The Property Practitioners Act (PPA) officially came into effect on 1 February 2022. It’s an important piece of legislation designed to protect consumers in the property industry. Here’s everything you need to know about the PPA:
In a nutshell, what is the Property Practitioners Act (PPA) all about?
The legislation is a continuation of the former Estate Agencies Affairs Act and the Estate Agent Fidelity Fund. It touches on transformation in the property sector and the regulation of estate agents, also known as property practitioners.
Who counts as a property practitioner?
The new law goes beyond traditional estate agents and includes managing agents, property developers, property brokers, bond brokers, bridging finance companies, bond originators, home inspectors, and any person who sells or lets property.
What is the Property Practitioners Fidelity Fund and how do I claim from the fund?
The Property Practitioners Fund is used to compensate consumers for the theft of trust money or the loss of trust money because of mismanagement of trust accounts. A claim must be lodged in a prescribed form in writing and as a pre-requisite, a criminal charge must be laid against the Property Practitioner.
What is a Fidelity Fund Certificate and who needs one?
A Fidelity Fund Certificate (FCC) is a certificate outlined in section 47(1) which confirms that the property practitioner complies with the provisions of the act. Anyone who earns a commission or brokerage from the sale or leasing of property needs a valid FCC which is valid for three years from the date of issue.
What is a Mandatory Disclosure Form and why is it so important?
A Mandatory Disclosure Form must be completed by the seller at the time of signing a mandate. Completing the form, with all known property defects, is compulsory and aims to protect consumers in the event of non-disclosure of defects. This disclosure form must be signed by all parties and attached to the sale or lease agreement.
How do property practitioners have to comply?
There are several key areas in which property practitioners have to comply with the law. For consumers, it’s important to note that going forward all practitioners must: open and maintain a separate trust account, deposit all trust money into the relevant trust account, and keep separate accounting records for trust accounts and have them officially audited.
For more information, please contact: Neil Mc Kinon – Hammond Pole Attorneys – NeilM@hammondpole.co.za | 011 874 1800