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Wednesday Jul 05, 2017

Property Code now binding

Trade and industry minister, Rob Davies, said yesterday that the Amended Property Sector Code had become binding on entities and organisations operating in the property sector.

Davies approved the gazetting of the Amended Property Sector Code in terms of Section 9 of the Broad-based Black Economic Empowerment Act on June 28. The Code was gazetted for public commentary towards the end of 2015.

The Amended Property Sector Code is applicable to commercial activities in the residential and commercial industries, as well as the value chain which includes property development, property services, property and facility management, broking, valuation, estate agents and other professional services.

Recent reviews estimate that the South African property sector market size is about R5.8 trillion, made up of commercial, residential, public sector and zoned land sectors.

It is estimated that out of 38 000 estate agents, only 13% are black, and this is among the challenges that the Amended Property Sector Code seeks to address.

Davies said even though the main focus of the code was not on land reform in South Africa, it should contribute towards reversing the legacy of the Natives Land Act of 1913, and subsequent discriminatory policy and legislation which denied black people access to productive land and property.

He said it should also contribute towards development and investment in the marginalised areas of the country.

"The Amended Property Sector Code has introduced a measurement indicator called Economic Development, which aims to stimulate property development in under-resourced and marginalised areas, while in the process addressing inequalities and creating wealth among previously disadvantaged groups," Davies said.

"The set target is 10% of all annual investment for development or redevelopment."

Davies said to accelerate an increase in ownership of black people in the sector, the Amended Property Sector Code has set a black ownership target of 27% for property owning companies.

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