Terminology:
IPCR – Immovable Property Condition Report - Report that must be completed and signed by the owner(s) or representative of a property before being marketed by an estate agent.
PPA – Property Practitioners Act - Act 22 of 2019. Since 1 February 2022 this act regulates the Property Practitioner industry.
OTP - Offer to purchase – This is a written offer that the purchaser makes to you, the seller, to buy your property. It specifies all the purchaser’s conditions relating to purchasing the property. Purchase agreement – Once a seller accepts the offer to purchase (OTP) in writing, it becomes the purchase agreement. This is also known as a ‘deed of sale’.
Overview:
From 1 February 2022 it is compulsory (as prescribed in section 67 of the PPA) for an estate agent, that market a property, to be in possession of a signed IPCR for the specific property.
It is also expected that the estate agent supplies a purchaser with a copy of the IPCR before signing an offer to purchase. It makes more sense in practise to make the IPCR available to the purchaser BEFORE viewing the property, as he/she will then be properly informed while considering the property.
When a purchaser signs an OTP he/she will also sign the IPCR and the IPCR will become part of the OTP.
What needs to be disclosed:
The IPCR requires the seller to disclose defects of a significant nature he/she is aware of. These defects imply any defect, whether patent or latent that would or could significantly:
• have an adverse impact on, or affect, the value of the property;
• impair or impact upon the health or safety of any future occupants of the property; or
• shorten or adversely affect the expected normal lifespan of the property, if it cannot be repaired, removed, or replaced.
Current challenges in terms of IPCR:
Unfortunately, not all estate agents have the same knowledge, moral values, and work ethic.
It often happens that a seller will question why he/she needs to complete an IPCR as “none of the other agents expected me to do so”
The reason why some agents don’t ask for an IPCR can be one of the following:
• Laziness: perhaps the agent does not want to do anything “extra” that could be in vain if the property is not sold by him/her.
• Lack of knowledge: perhaps the agent is not aware of the new act under which he/she operate.
• Taking short cuts: perhaps he/she is also the type of person that doesn’t understand the need or reason why we should stop at a red light….
Whatever the reason, as owner, you should be concerned if your agent is not adhering to the letter of the law, where else are you at risk because of the agent’s actions?
Conclusion:
Complete the IPCR and disclose all defects as required by the PPA and the common law to assure maximum protection for yourself and avoid costly legal battles later.
If the agent you are considering does not mention IPCR, perhaps replace him with an agent that is knowledgeable and willing to do everything possible to get the transaction in line with the letter of the law!
