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I am a qualified Attorney. I specialise in Property Law, Commercial Law, Corporate Law and Trusts.
 
Please visit our website at www.prop-law.co.za for more details.
 
I am an elected Committee Member of the Property Committee of the Association of Pretoria Attorneys and through my involvement, I like to ensure that I am constantly at the "sharp-end" of Conveyancing Practice.

I am the elected Chairman on the Gauteng Council of SAPOA. The South African Property Owners Association (SAPOA) is the biggest and most influential institution in the property industry. SAPOA members control about 90% of commercial property in SA, with a combined portfolio in excess of R150 Billion (about $22 Billion). I am also on the National Council and the National Legal Committee of SAPOA.
 
Member of the Institute of Directors South Africa and Member of the Sirdar Governance Panel.

16 May 2013

EAAB's intern monitoring system almost 'unworkable'

Although I am not an Estate Agent by profession, I do deal with Estate Agents on a daily basis and would be interested to know if Estate Agents share the opinion of Tony Clarke, Managing Director of the Rawson Property Group???

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EAAB's intern monitoring system almost 'unworkable'

The latest figures from South Africa's Estate Agency Affairs Board show that currently only 32,718 estate agents are still working in the formal recognized sector of the industry.

Of these, 10,373 are now fully qualified agency principals, 12,162 are full status (i.e. fully qualified) estate agents and 10,183 are interns learning to become fully fledged agents. Another 47 are attorneys who have chosen to acquire Fidelity Fund Certificates.

Tony Clarke, Managing Director of the Rawson Property Group, stated that it is now law that all new entrants to the estate agency profession, regardless of whatever qualifications they may have, have to be registered with the EAAB as interns and have to be monitored by their principals or by a full status estate agent (one who is fully qualified and has had a Fidelity Fund Certificate for at least three consecutive years) for a period of at least 12 months.

Interns are not allowed to perform any action which could affect the outcome of the sale unless they do so in the presence of and under the supervision of a mentor. All documentation, for example, has to be completed under the mentor's surveillance and any valuation of a property can only be accepted if the mentor has also inspected it. Similarly, any negotiation regarding price and conditions has to be done under the guidance of their mentor.

These rules, said Clarke, are exceptionally difficult to apply because, as the EAAB employment figures above show, there are so few fully qualified estate agents in South Africa and most of them are working long hours to maintain their own turnovers and meet their budgets.

To give an intern the full monitoring required by the EAAB, said Clarke, could mean that the mentor would have to devote as much as half his working time to this task - which only a few qualified estate agents are prepared to do.

"Inevitably, therefore," said Clarke, "estate agents and principals are reluctant to be involved and this will mean that they hold back on taking on interns. These rulings have, therefore, created a barrier to entry into the profession and, along with certain factors, have held back the transformation of our sector."

The rulings, added Clarke, could now result in dishonesty because the busy qualified estate agent, unwilling to hold back the progress of his intern, might sign the required forms testifying that the intern had received his full supervision, when in fact this had been done inadequately in terms of the EAAB rulings.

"The intern rulings, in my view, show that the EAAB is out of touch with how agencies and estate agents work," said Clarke. "I fear that they will encourage mentoring estate agents to act in a way that, although helpful to their protégées, is not strictly in line with the rules."

Another intern stipulation which has proved to be difficult to apply, said Clarke, is that which lays down that the intern has to inform any person who he is involved with in a property matter - especially his clients - that in fact he or she is still an intern.

"Although there will always be exceptions, the majority of clients, we have found, object to this and prefer to deal with a qualified estate agent, thereby denying the intern the opportunity to get the necessary experience. It has to be said that while no one wishes to deceive the client, the ruling about disclosing the intern's status is, in our view unnecessary, and, it can be added, the chances of a previously disadvantaged intern being fully accepted by clients will always be fairly low."

Another 'issue' that most estate agents find irksome, said Clarke, is the fact that the intern is expected to keep an onerous logbook of all his work activities and this again has to be approved and signed off by the mentor.

"The plain truth is that the EAAB board will never have the staff or the time to assess the interns' logbooks adequately and if such log books have been manipulated, with the consent of the mentor, they are very unlikely to have any way of discovering that."

"The real test of the intern should, we believe, be the exams that he writes at the end of his training period. These will show what he has learnt or what he has failed to learn. A logbook is, therefore, superfluous and nothing more than a nuisance."

Asked what he recommends as solutions to the current difficulties, Clarke said that the best plan would be to revert to the old system adopted by the EAAB, under which the estate agent was supervised on an on-going basis but to a far less stringent degree than currently is expected to happen. Everything he did - and particularly any documentation on which he worked - had to be checked, verified and approved by the mentor. Under the old system, said Clarke, the intern was allowed a far freer hand and greater scope to take the initiative and grow. The new system is a barrier to the Industry's transformation initiatives.

Rawson Property Group Press Release

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