The Property Practitioners Act (PPA) is a South African law that regulates the property industry, replacing the Estate Agency Affairs Act. It aims to regulate property practitioners, protect consumers, promote transformation within the sector, and provide for a Property Practitioners Regulatory Authority (PPRA) to oversee these functions.

The Act also establishes a Property Practitioners Fidelity Fund to compensate for losses caused by property practitioners.

The Property Practitioners Act modernises and expands the regulation of property-related professions. It responds to the changing needs of the property sector and introduces stricter compliance, broader oversight, and enhanced protection for consumers engaging with property practitioners across a range of transactions.

Key Objectives and Functions of the Property Practitioners Act

Key Objectives and Functions:

• Regulation of Property Practitioners – Defines who is considered a property practitioner and sets out the rules and regulations they must adhere to;
• Consumer Protection – Aims to safeguard consumers in property transactions by ensuring that practitioners act ethically and professionally;
• Transformation of the Property Sector – Promotes the participation of historically disadvantaged individuals in the property industry;
• Property Practitioners Regulatory Authority (PPRA) – Established to oversee the implementation and enforcement of the Act, including regulating practitioners, processing complaints, and promoting ethical conduct; and
• Property Practitioners Fidelity Fund – Compensates individuals who suffer losses due to theft of trust money by property practitioners, as explained in the PPA.

These objectives not only create a more accountable property sector but also aim to dismantle barriers to entry for historically marginalised individuals, advancing South Africa's social and economic transformation goals.

What Is a Property Practitioner?

The PPA's definition of a property practitioner is broader than the previous Act, including a wider range of individuals involved in property transactions. According to the PPA, it is essentially anyone who, for remuneration, engages in property-related activities like selling, buying, managing, leasing, or financing property or business undertakings. This includes:

• Estate agents
• All directors, trustees, and/or employees of estate agencies
• Auctioneers
• Property developers
• Property managers
• Franchisees
• Providers of bridging finance
• Mortgage Brokers (under dispute - exempt until further notice)

Answering the question what is a property practitioner shows how the PPA stretches far beyond traditional estate agents. Anyone involved in facilitating or financing property transactions needs to consider whether they fall within the scope of the Act — and if so, comply with the associated licensing and conduct requirements.

Industry Transformation in the Property Sector

The PPA aims to transform the South African property sector by promoting inclusivity and empowering historically disadvantaged groups. This includes measures to increase the participation of Black-owned firms and individuals in the industry, as well as consumer protection. The PPA also stipulates that government must prioritise property practitioners who comply with B-BBEE and employment equity legislation.

Industry transformation is not simply aspirational under the PPA; it is a regulatory requirement. Property practitioners must demonstrate ongoing commitment to transformation principles in order to access opportunities in public sector property dealings and comply fully with licensing conditions.

Property Practitioner Training Requirements

The PPA emphasises the importance of education and training for property practitioners, with a focus on developing a skilled workforce that can serve the needs of all members of the public. The newer guidelines around training requirements are focused on workplace learning over theory and encompass:

• 6 practical workplace learning modules (NQF4);
• Professional Designation Exam (PDE4); and
• Continued Professional Development (CPD) modules, every 3 years.

By introducing stringent training and education requirements, the property practitioners act seeks to professionalise the industry further. Practitioners are now expected to maintain up-to-date knowledge and skills through structured learning cycles, ensuring higher service standards for the public.

Property Practitioner FFCs

Section 48 of the PPA effectively bars a property practitioner from rendering services as a property practitioner if he or she does not possess a valid Fidelity Fund Certificate (FFC). Section 56 dictates that a property practitioner is not entitled to commission unless he or she is registered and possesses a valid FFC.

Holding a valid FFC is a non-negotiable legal requirement. Without it, not only is the practitioner barred from trading lawfully, but they also forfeit their right to claim commission — regardless of whether services were rendered successfully. Consumers are encouraged to verify a practitioner’s FFC status before engaging their services.

Mandatory Property Disclosure Form Requirements

Section 67 of the PPA mandates property practitioners to obtain a fully completed and signed mandatory disclosure form from sellers or lessors before accepting a mandate. This form, a Property Condition Report, must disclose any known defects or deficiencies in the property. The practitioner must also provide a copy of the completed form to prospective purchasers or lessees.

Failure to comply with the disclosure requirement could render the sale agreement invalid or lead to disputes post-transfer. The disclosure form ensures transparency upfront, reducing the risk of litigation and promoting fair dealings between parties.

Dispute Resolution

The PPA provides a dispute resolution mechanism in the property market through the PPRA. Individuals can lodge complaints against property practitioners for misconduct. The PPRA investigates these complaints and may refer them for mediation or adjudication. If mediation fails, the matter can be referred to adjudication, where an adjudicator will hold a hearing to determine the outcome.

The PPRA’s dispute resolution framework offers a structured alternative to expensive court proceedings, providing both consumers and practitioners with an efficient means of resolving issues related to property transactions and professional conduct.

Partner with an Experienced Conveyancer

Compliance with the Property Practitioners Act is critical for anyone operating in the property sector. Ensuring that mandates, disclosure forms, FFCs, and commission structures meet the latest legal requirements demands careful oversight.

VDM Incorporated offers expert guidance tailored to the needs of property practitioners and agencies. With over 35 years' experience in conveyancing, property law, and compliance advisory services, VDM Incorporated provides practical legal solutions that help practitioners meet their obligations confidently and efficiently.