Black People Locked Out of Property Investment 39 Years After EAA Act
In 1976 the apartheid government introduced the Estate Agencies Affairs Act that was to pave a way for the establishment of a board to 'regulate and control certain activities' in the property market. The Estate Agencies Affairs Board was established as a result.
It is very easy to deduce that the hidden aim of the act was to deal with what was bothering whites and their apartheid government at the time: black people were starting to enter the property market either as agents or buyers. This activity was also creating a very lucrative trade and it could not be left at the hands of 'blacks' because it would have serious implications to the 'white dominated economy' at the time.
This meant that any person who wanted to enter the property market in South Africa, to advertise or sell his property had to seek permission from the board (EAAB) to do so.
The act also provided for the setup of the Fidelity Fund with the aim of issuing certificates to practice as an estate agent. It is the same board that issued principals agents certificates to those wanted to open property sales businesses in South Africa.
If you did not meet the requirements of the fund, no certificate was issued and you were locked outside of the property practice. The law also made it compulsory for all 'white estate agents' to pay 'kick backs' to the board (fidelity fund) as a way of saying thank you for protecting us from black competition.
If you did not meet the requirements of the fund, no certificate was issued and you were locked outside of the property practice. The law also made it compulsory for all 'white estate agents' to pay 'kick backs' to the board (fidelity fund) as a way of saying thank you for protecting us from black competition.
The serious implication of this setup was that black people who wanted to move to big cities had to depend on white estate agent's mood to be accepted as tenants. This also protected white owners as the application process was kept a secret. If a black tenant's application competed with a white applicant, the outcome was very obvious.
Here is my question to you: Has this changed?
Here is my question to you: Has this changed?
Property Rental In South Africa
My view is that nothing has changed at all!
My view is that nothing has changed at all!
In 2015 just about 93% estate agents are white and are sometimes promoting white tenacity/onwership especially is suburbs still reversed for whites. There are still block of flats in big cities where you do not find a single black tenant because their application are decline.
Lack of Transformation In Property Sector
The same board is still responsible for all activities in the property sector. My greatest concern is that no transformation has taken place to ensure that black people compete equally in property economics. The upsetting part here is that it seems that this board does not think that there is something wrong with the whole property sector setting.
On its website the board relaxedly states that:
"The aim of the transformation strategy is to define the role and contribution of the EAAB in accelerating the transformation of the estate agency profession to reflect South African demographics."
It continues to say:
"The transformation strategy seeks to contribute towards creating an enabling environment which will attract greater numbers of previously disadvantaged persons to the estate agency profession."
Why is it that in 2015, we are still talking about what we are 'aiming' for as something of the future unknown? Is it really acceptable that we are still mapping strategies that 'seek' to transform after 39 long years since the act was introduced?
Real Estate Companies in South Africa
The Property Sector Charter Council announced in 2012 that the property market in South Africa was worth R4.9 trillion. This contributes about R192 billion to the economy of South Africa. The lack of transformation in the property sector means that black people are still not able to create wealth from this lucrative industry.
Where are black owned property companies?
If you drive around the streets in all upmarket suburbs of South Africa, you will notice that all property advertisements are placed by white owned companies that continue to drive property prices over the roof. Banks are enjoying the ride and foreign property owners are lobbied to come and buy property in South Africa.
This means that even property investment is still in the hands of foreign companies in South Africa. These investors have no interest in the inclusion of black people in economic activities taking place in property.
When South Africa was grabbling with xenophobia, property investors were busy obsessing about the impact on their investments in property. Some of them came out to attack President Zuma and the government for not doing anything about xenophobia despite all attempts to stabilize the country.
The Investment Property Databank (IPD) director, Stan Garrun, was quoted saying that his concern was negative trends in SA that damaging its property sector reputation as an investment destination.
The IDP was developed by US-based MSCI.
By: Scelo Mncwango
Email: sicelo@uhurumedia.com
Mobile: 083 923 1394
The Investment Property Databank (IPD) director, Stan Garrun, was quoted saying that his concern was negative trends in SA that damaging its property sector reputation as an investment destination.
The IDP was developed by US-based MSCI.
By: Scelo Mncwango
Email: sicelo@uhurumedia.com
Mobile: 083 923 1394