Important message for South Africans entering the property market

Considering the numerous serious legal and financial risks associated with property transactions, experts advise buyers, sellers, and renters always to verify whether their agent is registered.

Samuel Seeff, chairman of the Seeff Property Group, explained that these parties can protect their interests by ensuring that they work with a property agent who holds a valid Fidelity Fund Certificate.

Failing to do so could leave South Africans vulnerable to serious financial risks. Rental scams, in particular, have been on the rise recently.

This is a result of South Africa’s current high demand for rental properties, which is exceeding supply.

Supply shortages have made the rental market a fertile hunting ground for scammers, with the Seeff group warning that property fraud is rising.

Scammers typically post fake rental listings on popular platforms such as Facebook groups, Facebook Marketplace, and WhatsApp groups. They often use photos taken from legitimate property adverts.

These Fraudsters lure people with attractive rental amounts and claim the property is in high demand. Victims are pressured to pay a deposit or viewing fee upfront, only to discover the listing was fake and the scammer has disappeared.

Working with a registered agent can help prospective renters, buyers and sellers protect their assets on the property market. “The requirement is something that all property professionals across the property landscape must have,” Seeff said.

The Property Practitioners Act 22 of 2019 and the Property Practitioners Regulatory Authority (PPRA) regulate the conduct of all professionals in the industry.

Every operator is legally required to be registered with the PPRA and hold a valid Fidelity Fund Certificate (FFC). FFCs are issued by the Property Practitioners Regulatory Authority (PPRA), and are valid for three years.

“Clients dealing with property agents and practitioners must therefore check that the agent is in possession of a valid FFC,” Seeff said. “This is a vital safeguard for clients and their properties and funds.”

Clients can visit the PPRA website to verify that their agent is registered. They must ask to see the FFC of the agent to verify the name and validity of the dates.

This will confirm that the agent or practitioner is legally registered and compliant with industry regulations. Every agent must have their own FFC, and practitioners cannot use someone else’s certificate or that of the agency that they work for.

Staying safe on the property market

“A Fidelity Fund Certificate essentially serves as an operating license as well as providing crucial protection for clients,” Seeff explained.

Agents must therefore be registered with the PPRA. Part of this registration would include verification that the agent is compliant and holds the relevant qualifications.

The PPRA also regulates the conduct of agents through the enforcement of the Property Practitioners Act and a Code of Conduct.

This ensures that agents maintain ethical standards, including transparency and disclosure, and proper management of trust accounts.

It also investigates complaints, conducts inspections, and can impose disciplinary sanctions in the pursuit of maintaining integrity and protecting consumers within the sector.

The Property Practitioners Fidelity Fund provides a financial safeguard that protects clients against the misappropriation of money they deposited with property agents or attorneys for safekeeping. Affected clients can lodge a claim with the PPRA.

“By ensuring you work with a property agent who is registered with the PPRA and holds a valid Fidelity Fund Certificate, clients know they are dealing with a competent and credible property agent,” Seeff said.

A reputable agent will ensure compliance with industry standards, the code of conduct, and regulations, while also providing superior service to maintain their reputation.

Seeff added that working with a property practitioner with a valid Fidelity Fund Certificate is not only a matter of compliance but an essential safeguard for your financial security and peace of mind.

“By prioritising this simple verification, clients can confidently navigate property transactions, knowing they are protected by the highest industry standards.”