Estate agents in the property sector have long been bound by “dinosaur” legislation and the profession has remained untransformed since the advent of democracy in 1994, Estate Agency Affairs Board (EAAB) transformation committee chairperson Eugenia Kula-Ameyaw said on Monday.
“The Estate Agency Affairs Act 112 of 1976 fails to cater for transformation in an unequal profession or to take into account the imperatives of a constitutional democracy,” she stated during an EAAB hosted event to discuss the board’s efforts to facilitate transformation in the sector and include more previously disadvantaged individuals (PDIs) by removing barriers to entry.
The property sector has a market value of R7.9-trillion and contributes about 8% to gross domestic product; it is, therefore, essential for such a big sector to reflect the demographics of South Africa, Kula-Ameyaw said.
CEO Mamodupi Mohlala-Molaudzi explained that the EAAB would publish a detailed business plan in the next few months to share how it would implement transformation imperatives in the sector, which will include attracting more youth to the sector, promoting skills development and accommodating PDIs to enter the sector, as well as aiding matters of equity and enterprise development.
This comes as the Property Practitioners Bill is being promulgated to become an Act. That process is expected to be completed within the next few months.
The Bill has an entire chapter dedicated to transformation imperatives, which is not included in the existing legislation. The existing legislation provides a section (Section 27) that grants exemption from the requirements of the Act, where it is in the interests of justice to do so.
Meanwhile, while the sector is awaiting the new legislation, the EAAB’s board of directors has resolved to assist estate agents to make use of the Section 27 proviso in the existing legislation through EAAB administrative processes, which will remove barriers to compliance, in order to be issued with a Fidelity Fund Certification (FFC), which is legally required by estate agents to operate.
Applicants can base their justification for noncompliance on economical or social aspects that have hindered their progression in the sector.
For example, the current procedure entails that estate agents go through an auditory process before applying for an FFC, which is expensive, as well as the FFC application itself, which is also expensive and unattainable for a small business.
However, EAAB applications manager Advocate Debra Vial pointed out that the sector is not open to all who now wish to become estate agents; applicants still have to comply with conditions set out by the board. The board will merit each application individually and monitor compliance to their conditions for estate agents to be able to keep their FFCs.
Should estate agents not comply, their FFCs will become invalid and ineffective.