Property Practitioners Act needs more clarity – here’s what the experts know

Property Practitioners Act needs more clarity – here’s what the experts know

MAIN IMAGE: Adrian Harris, CEO of Charter Academy

Staff Writer

In comparison to other careers with similar earning and growth potential in South Africa, becoming a property practitioner is not a typical career choice. Despite the benefits a career in this versatile sector offers, many have been deterred due to the onerous pathway to qualify.

However, the recently promulgated PP Act and Regulations may change this.

The new legislation now provides for the meaningful participation of historically disadvantaged individuals in the property market and coupled with the revised educational requirements will provide even greater access to the sector. A further requirement of the Act is that to qualify for a Fidelity Fund Certificate (FFC) every property practitioner (meaning the firm), must be in possession of a BEE certificate.

BEE rating and skills development

The most effortless way to boost one’s BEE rating is through skills development.

The Property Sector Charter demands a far greater investment in skills development with a particular emphasis on accredited training and learnerships. Instead of looking at training and skills development as a compliance exercise, real estate firms should rather be asking how they can make sure their training spend earns them a greater number of BBBEE points, while at the same time making them more competitive.

Learning and development programmes can make a significant impact on both employee retention and attraction of new talent. The industry has been accused of being slow to transform. Statistics released by the PPRA in their annual report of 2020/21 show that 75% of the industry are white practitioners. And candidacies are a sure way to stimulate transformation and attract new blood to the industry.

Adrian Harris, CEO of Charter Academy, states that “Instead of being critical of this new directive, industry should be taking advantage of the many incentives and cost-effective opportunities available to them in the skills development and training arena.

“If every agency needs to have a B-BBEE certificate, the easiest way to achieve this is through a training provider which is level 1 -B-BBEE compliant company with a 135% procurement return. This means that you will not only fully train your employees but will also maximise your B-BBEE scorecard.”

Some of the most notable changes in the Act and Regulations:

  • Candidates will serve a 6-month candidacy and not 12 months as before.
  • Candidates are now able to write their PDE 4 exam without having registered with an agency, which means they can remain in their current employment, but they would need to complete a 6-month practical course either before or after the exam.
  • Everyone who practices in the industry must write the PDE4 exam – no exemption or exception.
  • Every agency is required to have a B-BBEE Certificate and no FFC will be issued to an agent if this is not attained. Agencies that earn less than R2.5m a year are exempt but need to provide an affidavit.
  • CPD will change from 60 points over a 3-year rolling cycle to 12 modules [4 per year] to be completed over a 3-year rolling cycle

While focusing on Skills Development as a priority element that will greatly enhance an organisation’s BEE scorecard, it should not be the sole purpose.

Skills development

Skills development can be used as a tool to improve much needed professionalism within the sector. For example, NQF qualifications and soft skills training contributes to employee development long term. Should a company decide to register a learnership and take on a learner after a year on the job, the company will receive 5 extra bonus points, provided that the company has a SETA approved Workplace Skills Plan in place. Additionally, by complying with certain legal and procedural requirements, employers may claim 20% of their Skills Development Levy (SDL) back from Services SETA in a Mandatory Grant.

Enterprise development

Enterprise and supplier development are other priority elements to maximise BEE points. This supplier development portion of the scorecard encourages companies to assist black-owned suppliers. Making use of PDI training providers maximises the scores under this element. Companies using a Level 1 QSE for instance, can qualify for up to 135% procurement spend.

The implementation of the Act has brought about the need to expedite many changes for compliance and business sustainability. According to the PPRA annual report there are currently 8475 black interns and 14998 white interns that still need to write the mandatory PDE exam to become qualified Property Practitioners. Currently many training providers including Charter Academy are diligently assisting with qualifying thousands of agents with this predicament.

“In this current scenario, the best thing to do is to consult with the experts before it is too late,” says Harris. “The changes in the mandatory requirements for training lowers the barriers to entry and should not be seen as a panacea for success in the sector, but rather as an opportunity to acquire appropriate skills.”

South Africa’s current economic trajectory is unsustainable: economic growth has stagnated, unemployment is rising, inequality remains high. And while the COVID-19 pandemic has presented many challenges, the real estate sector has proven to be resilient in downturns relative to other sectors.

The key to enabling inclusive growth and economic transformation is characterised by low barriers to entry and must include progress on the fundamental building blocks of long-term sustainable growth. “If we are to make a difference, real estate business owners need to promote competitiveness and inclusive growth,” says Harris.

Harris concludes: “We need to support this new legislation by creating an enabling environment for Property Practitioners to thrive. Improved access to education and skills development is a conduit for meaningful transformation and growth.”

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