Concerns raised over new property and building laws planned for South Africa

The Housing Consumer Protection Bill could put the survival of small businesses at risk and lead to further job losses as it aims to clamp down on unregulated builders.

These are some of the concerns raised around the bill which is currently being considered in public hearings by parliament. The bill aims to ensure adequate protection of housing consumers by further regulating the home building industry.

It also plans to introduce contractual provisions to protect new entrants into the home building industry, and address provisions such as a warranty fund surplus.

Notably, the bill will mandate the registration of builders in the country as well as formal training.

However, builders fear that this provision to register with the National Home Builders Registration Council and the subsequent annual membership fee was unaffordable, especially because they undertake small construction work which makes it difficult to break even. They called for small businesses to be exempted from registration to ensure transformation within the industry.

Despite this, there was general support for the bill and its provisions especially the protection of consumers against unscrupulous builders who build substandard houses that are not only unsustainable but put the lives of consumers at risk.

Furthermore, there was is also concern about the lack of transformation within the construction sector which continues to marginalise small businesses. This leads to a select few big construction companies getting most of the bigger construction projects, commenters said.

Those in support of the bill highlighted its potential to protect consumers especially beneficiaries of RDP houses who continue to suffer as a result of shoddy workmanship. Participants emphasised that full implementation of the bill is necessary upon enactment into law.

“Through this bill, it is hoped that home builders will benefit by appointing registered builders, which will ensure quality housing, as well as extend protection through the extension of warranty cover,” said parliamentary committee chairperson, Machwene Semenya.

The bill proposes these protections through the repeal of the Housing Consumers Protection Measures Act of 1998, by providing protections for housing consumers, registration of homebuilders, continuance of home warranty fund, and sets out the framework to claim against the fund.

The bill also provides continuance of the National Home Builders Registration Council as the National Home Building Regulatory Council.

“Also, an important pillar of the bill is its transformative outlook, which seeks to improve builders and downstream the consumers. This protection is proposed through the bill’s call for registration of builders, which will require proper training for builders, which will enable full economic participation.

“Furthermore, a database of registered builders and their grading would assist the sector in knowing what builders are available and at what level,” Semenya said.

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Concerns raised over new property and building laws planned for South Africa