The Potential Impact of the Housing Consumer Protection Bill

The Housing Consumer Protection Bill aims to regulate the home-building industry by mandating the registration of builders in South Africa and formal training. It also aims to ensure adequate protection of housing consumers; and has contractual provisions that protect new contractors as well as  address certain provisions such as a warranty fund surplus. This bill is currently considered in public hearings by parliament and will have a direct impact on the Construction and Contractual Laws in South Africa.

Concerns Surrounding This Bill

One of the primary concerns for the home-building industry is that this bill could put small businesses at risk and lead to job losses in this sector as a result of the clamping down on unregulated builders and contractors. By mandating registration with the National Home Builders Registration Council, the annual membership fee could put further financial strain on small contractors that struggle to break even when taking on construction contracts. There has already been a push back to exempt small contractors from this bill, should it pass.

In the case that the bill passes, concerns have been raised that a handful of large construction companies in South Africa will get most of the bigger construction projects, as they will be the only viable options under the new regulations. However, the bill and its intended provisions have received general support for the positives that could come from the implementation of such a bill, especially regarding substandard housing construction that could pose a threat to future inhabitants by putting their lives at risk.

The Proposals

The Housing Consumer Protection Bill proposes a repeal of the Housing Consumers Protection Measures Act of 1998 and offers housing consumer protection, home-builder registration, a continuation of the home warranty fund, and the means to claim against that fund. Although the bill has net yet been passed, it could completely transform the construction and home-building sector in South Africa in the case that parliament decides to implement this bill.

Should you be a consumer or a contractor who may be affected by this bill and/or indeed any dispute arising out of the built in construction industry contact the experts before taking action to avoid possible litigation and the exorbitant legal fees that often accompany such litigation.

At Allardyce and Partners we are uniquely situated in that we offer professional services in the construction law sector on a “no win no fee basis” subject to our terms and conditions.

Contact Allardyce and Partners at:

Tel: 011- 234 2125

Email: kevin@allardyce.co.za or franco@auroraconsultants.co.za

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