The Responsibilities of a Principal Property Practitioner

Principal Property Practitioners in South Africa are governed by the Property Practitioners Act 22 of 2019. What does this mean? The Principal must ensure that they act within the parameters of the PPRA Act, Regulations, and the Property Practitioners Code of Conduct and Ethics. These provisions ensure that the estate agency operates legally, ethically, and efficiently. The Principal is directly accountable.

Let’s look at the different aspects of these responsibilities, remembering that only the Real Estate category has a principal agent. Should you be a director of any other category of estate agency firm, then you take on the same responsibilities and obligations as those of a real estate principal agent.
While we have done our best to include all the principal responsibilities, regulations may change, and the Principal should ensure that they are always up to date with changing legislation.

PPRA compliance

• FFC – Ensure valid Fidelity Fund Certificates are issued for the firm, Principal, and all agents.
• Registration with the PPRA is up to date.
• The Code of Conduct is trained across the firm.
• Mandatory disclosure forms are used for all contracts.
• FICA registration of the firm, annual training of agents, contracts and documents on file, and KYC documents checked for each transaction.
• POPI & PAIA registration of the firm, training of staff and agents, filing of Compliance Manuals and related documents.
• Annual audit reports are submitted by the auditor timeously.

Agent Supervision & Training

• Qualification requirements must be met.
• Candidates or Interns are mentored and assisted with all interactions with the public, especially the signing of contracts.
• CPD – Continuing Professional Development annual modules are completed.
• Training of all staff and agents is attended to regularly so that they remain current with regulations and market trends.
• Policies and procedures for ethical conduct and compliance are communicated and followed.
• Disciplinary policies are in place and adhered to.
• Marketing, advertising, and branding are legally correct and aligned with the agency’s policies.

Financial Accountability

• Trust accounts are opened with approved financial institutions and operated correctly, or exemption from holding a trust account is obtained.  Trust account reconciliations are conducted and signed off. There are no unauthorised withdrawals or misuse of client monies.
• Client funds are deposited and disbursed strictly in line with PPRA rules.
• Management accounts and records are complete, accurate, and securely stored.
• Annual financial statements and audit reports are submitted to the PPRA within the required deadlines.

Strategic Leadership Undertaken by the Directors

• Business strategies are in place.
• Policies and procedures are documented.
• Marketing materials and contracts comply with the PPRA’s disclosure rules.
• The brand is managed professionally.

Personal Liability of the Principal

All the above responsibilities lie with the Principal, who must ensure that records are kept and that the firm is always prepared for a PPRA audit.
The Principal Property Practitioner is personally accountable for every aspect of the agency’s operations. Regular internal compliance checks, supported by regular reports and financial documents, are not negotiable.