1. The Property Charter: Another step forward 2. E-Stamping your Leases 3. Prospective Property Valuers



Issue 55 • March 2006 THE PROPERTY CHARTER: ANOTHER STEP FORWARD Implementation of the Property Transformation Charter is drawing near. The Charter is intended to make radical changes to the South African property sector - including the estate agency industry - and as part of that sector, and as a signatory to the Charter, the IEA is very much part of the process. If you are an estate agency firm, then you too are part of it. You may be expected to implement the Charter in your own firm and, even if you aren't, we certainly encourage you to support it. Here are highlights from the final draft of the Charter, as they affect our industry. What is the purpose of the Charter? The Charter is a blueprint for achieving the long overdue transformation of our industry. As part of the overall Broad-Based Black Economic Empowerment (BBBEE) structure, it has been designed to bring more Coloured, Indian and African people into the industry (at all levels, from candidate estate agent up to company director), to promote Coloured, Indian and African property ownership and investment, and to encourage preferment of Coloured, Indian and African service providers. How does it work? Targets have been set in several categories, and firms are expected to achieve them within five years. After the end of each year, a firm must compile a progress report and a scorecard, have them verified by an accredited BBBEE verification agency, and submit them to the Charter Council, which is to be set up to manage the Charter. The score on the scorecard determines the firm's BBBEE status for that year. Status is divided into eight levels (Level 1 being a score of 100/100), and Level 4 seems to be the minimum score to aim for. Who must implement the Charter? Ideally, every estate agency firm should contribute towards transformation. However, the reality is that the majority of estate agencies are very small, and it may be impractical for them to meet the targets. Therefore, estate agency firms which fall into the categories of "micro" or "very small" enterprises, as defined in the Charter, will be exempted from obtaining BBBEE verification. They will simply be regarded as having BBBEE Level 4 status (or Level 3 if 50% or more of the owners are Coloured, Indian, and/or African). A larger firm should obtain BBBEE verification, though there is no legal compulsion to do so. However, we believe that a firm which chooses not to, should consider the implications carefully before making that decision. What are the targets? The targets which a firm should work towards over the five-year period are outlined below. In very broad outline, the targets are: § 25% of the shares/interest in the firm should be Coloured-, Indian-, and/or African-owned § 40% of the firm's directors should be Coloured, Indian, and/or African § 30% of the firm's managers should be Coloured, Indian, and/or African § 30% of the firm's "practitioners" (agents) should be Coloured, Indian, and/or African § over and above the skills development levy which the firm pays to the Services SETA, it should be spending the equivalent of 1½% of its payroll on skills development for its Coloured, Indian, and/or African agents and staff § 2½% of the agents and staff should be in registered learnerships § 2½% of the agents and staff should be in mentorship programmes § the firm should be providing continuing professional development to its Coloured, Indian, and/or African agents and staff § the firm should be buying 70% of its goods and services from sources with BBBEE status (40% at Level 4 or higher) § the firm should be spending 3% of its annual pre-tax profit on financial assistance to Coloured, Indian, and/or African property-related enterprises, and be providing such enterprises with non-monetary assistance equivalent in value to 2% of its annual pre-tax profit § the firm should be involved in corporate social investment programmes. A strong challenge indeed, and one that should change the face of our industry quite significantly. We emphasise that the above is a very broad outline. For fuller details of the targets, and the scorecard, you should obtain a copy of the Charter, which is downloadable from the following website: www.propertycharter.co.za. Choose "Charter Draft Ver 6d" from the menu. ------------------------------------------------------------------------------------------------------------------ e-STAMPING YOUR LEASES Are you still stamping leases the old-fashioned way? By buying revenue stamps, sticking them onto the document, and cancelling them? Or have you moved with the times and changed to e-stamping? SARS would like you to e-stamp, and they recently gave an excellent presentation on the subject to IEA Western Cape members. How does e-stamping work? It's pretty simple. You will need internet access, a printer, and a commissioner of oaths. First you must register on the SARS e-filing system. Simply access the website (www.sarsefiling.co.za), click on "register", and follow the instructions on the screen. You will need to choose a password. The system enables you to register your firm, and individuals within it, as users. You can update details, and add or remove users, as and when you need to. Once you are on the system, you can e-stamp a lease by logging on, entering the details of the lease, and making an electronic payment - in other words, internet banking. You receive an e-mail confirmation that the stamp duty has been paid - print it out, have it certified by a commissioner of oaths, and attach it to the lease. We're very impressed by the e-filing system, and by the "user-friendliness" which SARS have built into it. If you would like to speak to someone at SARS about this, there is a call centre which is open during working hours on weekdays (0860 709 709). ------------------------------------------------------------------------------------------- PROSPECTIVE PROPERTY VALUERS The next part-time course for the Professional Single Residential Property Assessor Certificate begins at the Cape Peninsula University of Technology in July. It will be preceded by a module on property economics and mathematics, which is designed to bring students up to the required level of mathematical skills. If you're enrolling for the PSRPA course, and would like (or need) to brush up on your maths, then we recommend that you attend the preliminary module, which begins on 17 July. To book, contact the CPUT: 021 460 4286.