Mamodupi Mohlala-Mulaudzi has been in her role as head of the Estate Agencies Affairs Board (EAAB) for a year during which she has been trying to improve the weakened reputation of the state entity and to educate people that its role extends beyond merely issuing Fidelity Fund Certificates (FFCs) to estate agents.
The mandate of the EAAB has been extended by the forthcoming Property Practitioners Bill, the first time the legislation that governs estate agents, managing agents, auctioneers, bond originators, bridge financiers and other entities has been changed since 1975.
She sat down with Business Day to discuss how she is making the EAAB more efficient, more accessible and more relevant to consumers and professionals.
Why is Property Practitioners Bill so important for the EAAB?
It’s so long overdue and is necessary to regulate a sector which has changed over the years.
The act now regulates beyond just estate agents. It only stops short of the conveyancers because they are regulated by the Legal Practitioners Act. So basically the whole value chain is included here. Historically, the act had only captured the residential side, but now the commercial side is also included, which provides for better regulation.
We want to show people, especially young black people, that there are many opportunities in property. These go beyond just buying and selling houses.
There is also now a whole chapter in the act that speaks to transformation and makes it obligatory for us as a regulator to monitor transformation. It talks to transformation in terms of the charter codes, that we must obviously make reference to that and it speaks to transformation from the perspective that all procurement in the property sector must be done from service providers that are identified by ourselves as being compliant with broad-based black economic empowerment.
We now have to establish a dedicated transformation fund as opposed to using the Fidelity Fund for transformation. We are also establishing a research centre in conjunction with universities, which will help us to get accurate statistics.
How do you shake the negative perceptions some people attach to agents, the idea that people who become agents do so only because they can't do anything else?
Being an estate agent is still seen by some as a profession of last resort. Yet despite the weak economy, we still see the number of estate agents rising each year across racial groups. It still attracts entrepreneurs and this is part of why the EAAB needs to educate people better about how the profession works. We need to show that this is a serious profession and that the EAAB has real powers to support its members.
We want to show people, especially young black people, that there are many opportunities in property. These go beyond just buying and selling houses.
There are opportunities everywhere. At a state level there are opportunities in RDP housing for example. The database around RDP has plagued the government. There is no record of who stays where. There are no records of back room dwellings and how they are established. But landlords could use estate agents to set up and manage lease agreements for these kinds of housing.
Social housing also needs property managers. This role could be performed by estate agents. Estate agents could also work in the management of properties owned by the department of public works. Estate agents can work at more competitive prices than consultants for the private sector, for companies like Broll and Growthpoint.
Being an agent can be seen as a high risk career because it is commission based. How then do you get people from challenging backgrounds into this career?
It comes down to effective incubation. We need a mechanism to help people to get dedicated access to markets perhaps for five to 10 years so that they have a fair chance at success after completing their training.
We also want to create an amnesty for those who are blocked by regulatory issues. Many starting agents can’t afford to pay registration fees which can be onerous. You have to pay registration fees as agents, fees for exams and you must pay the Fidelity Fund to keep your FFC status. So we feel those who prove they cannot afford this should get a five-year amnesty period while they find their feet.
Should the public access the EAAB when they have problems with estate agents?
We have powers to discipline agents. We encourage people to approach us if they find their agent behaves poorly. If you find that you buy a house and there is a defect which the agent knowingly hides, you should raise this with us and we will take action, free of charge. This is about ensuring the protection of the consumer. Even if the problem is not on the part of the agent we can subpoena the seller and see where the liability lies.
I want to educate people about the EAAB and show them that this is a serious agency which supports a critical sector in this country.
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