New Consumer Protection Initiative: A Licence to Sell

The real estate industry has completely evolved, from anyone being allowed to sell property or sign contracts in previous years, to it now being a professional occupation and one can definitely understand why. “Without training or ensuring one stays up to date with the latest legislations, clients are left vulnerable for facing possible major losses and legal issues” cautioned Craig Hutchison, CEO of Engel & Völkers Southern Africa.

By having a professional managing transactions, it eliminates many problems or disputes which can arise, which is why the EAAB instituted certain criteria before you are 'licenced to sell'. As in any trade, a managing board to ensure the adherence of a code of conduct needs to be set in place, to make sure consumers receive nothing but expert and professional service. The EAAB (Estate Agency Affairs Board) was established in 1976 and since then regulates the estate agency profession. The EAAB in essence, acts as a watch-dog and protector of consumer interest in the real estate transaction. They also ensure that all persons carrying out the activities of an estate agent as a service to the public, are registered and qualified. As proof, a real estate agent must hold a valid FFC (Fidelity Fund Certificate), which is issued by the EAAB and must be renewed annually as confirmation that such person is legally entitled to carry out the activities of an estate agent.

A full status FFC is only issued after a candidate has completed a year's internship, the NQF4 or NQF 5 qualification, as well as passing the relevant PDE exams. One could consider this qualification to be the equivalent of a diploma or degree. In order for an agent to maintain their qualification, they work according to a point system whereby agents need to attend training through qualified institutions and law firms in order to accumulate the points for the year. This is similar to having to many other professions such as Pilots, who have to be retested to ensure they are still up to standard and that you are in safe hands when aboard a flight.

This year, the EAAB has taken it a step further by launching its new customer protection initiative designed to help consumers distinguish between illegal operators and legitimate estate agents as an extended manner of confirmation. “It is essential that consumers only deal with registered estate agents who can be trusted to provide expert and professional advice and, moreover, act in the best interests of consumers. Many people claim to be registered estate agents when they are not and place the consumers with whom they are transacting at considerable risk” Craig noted.

By partnering with PrivySeal (Pty) Ltd, the EAAB provides customers with an easy and highly secure means to identify and only deal with registered agents. PrivySeal issues professional estate agents a digital seal (“Privyseal”) and hyperlinked Verification Certificate which confirms the current registration status of those estate agents in real-time. A Privyseal is only displayed once the EAAB database confirms in real time that the estate agent concerned currently holds a valid FFC. All registered estate agents must access and embed their Privyseal into their email signature and digital media such as, for instance, websites and social media profiles.

The EAAB first piloted the implementation of the PrivySeal programme with only a few larger estate agency firms of which Engel & Völkers Southern Africa was proud to be part of, after which it will be rolled out to the sector at large as of 01 August 2016.

“The PriviSeal programme is most definitely the start of a new evolution in real estate. Educational and certification requirements are but a small start to where a career in real estate may lead in South Africa” Craig concluded.