How the Property Practitioners Act impacts your sale and rental

From 1 February 2022, the real estate industry took a step forward with the commencement of the Property Practitioners Act. This Act brings a number of changes to regulate and professionalise the property industry. Most importantly for you, it also provides increased protection for consumers and enforces statutory controls in your property dealings. When you're selling or renting out your property, it's now compulsory to include a disclosure document of property defects. Kellaprince Properties takes a closer look at the Act's implications for sellers and landlords. 

The Act and property practitioner regulations

The Property Practitioner Act makes it compulsory for all registered property practitioners to have a Fidelity Fund Certificate. Your property practitioner will not be entitled to remuneration or payment from the sale or leasing of your property unless they are in possession of this certificate. All property practitioners will need to be registered with the Property Practitioners Regulatory Authority (PPRA), a new regulatory body, for fidelity fund certificates to be issued.

In addition to this, property practitioners will also need a valid tax clearance certificate and a BEE certificate. The businesses they represent must also be registered and fully compliant with taxation and BEE. 

What the Act says about disclosing defects

While it has been a best practice to provide a comprehensive property defects disclosure document, it is now compulsory for all property sales and lease agreements. According to the Property Practitioners Act, a property practitioner cannot accept a mandate unless you, as the seller or lessor, has provided a fully completed and signed mandatory disclosure. The property practitioner will then provide a copy of this to a potential buyer or renter of your property. 

This completed mandatory disclosure form must be signed by all relevant parties and included in the agreement for the sale or lease of a property. If no disclosure form is completed, signed, or attached, the agreement will be treated as if there are no defects or deficiencies were disclosed by the seller or landlord. 

With the Act's requirements, it's more important than ever to choose your property practitioner with care. All property practitioners at Kellaprince Properties, for example, are fully registered with the PPRA and have valid FFCs. With their help, you can take care to list all possible defects, big or small, as this will protect you against any future claims. 

Understanding property defects 

A defect means any condition, whether it is visible or not, that could have a significant adverse impact on, or affect the value of the property, or that could significantly impact the health or safety of the occupants. Also if not repaired, removed or replaced, it could adversely affect the lifespan of the property. The Property Practitioners Act requires you to list both patent and latent defect types.

Patent defects are those that are not hidden and easy to spot with a reasonable inspection. Examples of patent defects include wall cracks, torn carpeting, damaged light switches, sagging gutters, and broken cupboards. 

Latent defects, on the other hand, are those that are not easily discovered by a superficial inspection. It will usually take an expert to uncover them. Examples of latent defects include faulty geysers, rising dampness, insect damage, and foundation issues. 

Doing a home inspection with a reputable expert can help to uncover any defects on the property you have your eye on. This will provide a detailed analysis of the condition of all components of the property at the time of inspection. 

Get on top of property defects 

Sellers or landlords who try to cover up or conceal defects can be sued. However, for defects that they were unaware of and obviously not able to declare, they will not be liable. Buyers and renters are advised to seek the services of home inspectors to ensure that the property is up to scratch. According to the Act, buyers are fully entitled to undertake a property inspection to confirm the state of the property before finalising the transaction.

During a home inspection, the property's roof, walls, doors, windows, drainage, plumbing, to name a few will be examined. Beyond identifying defects, the inspector will also pinpoint any issues and provide steps on overcoming them, and the costs involved to do so. They will also reveal any building regulation or law violations. 

Stay on track with the Act

As a property seller or landlord, you need an estate agency that will help you stay on the right side of the law. Kellaprince Properties supports the regulations outlined in the Act and is committed to ensuring compliance with every property transaction. List your property for sale or to let with us today.