Jul 262013
 

The Housing Consumers
Protection Measures Act 95 of 1998

Updated 2008 – EXPLAINED

A well built house in a development that was built on time and in budget is all that a Housing Consumer wants.

A well built house in a development that was built on time and in budget is all that a Housing Consumer wants.

1. The main purpose of the Housing Consumers Protection Act is to give protection to housing consumers. At the same time it created the NATIONAL HOME BUILDERS REGISTRATION COUNCIL (NHBRC), whose objective is to stand for the interests of housing consumers by giving a warranty to protect against defects in new homes and to give cover to housing consumers in respect of the failure of builders to fulfill  their obligations in terms of this Act.

2. A housing consumer is a “person who is in the process of getting or has taken possession of a home and includes such a persons “successor in title”. What this means is, that for the period that the “original” homeowner is covered by the warranties that may be applicable in terms of this Act, that warranty remains in place no matter the change of ownership. Any other action undertaken by the first owner is transferred to, and enforceable by, the new owner – so long as the original owner did everything in line with the Act. Different time frames apply depending on what the defect is.

3. A homebuilder is defined as a person who carries on the business of a home builder and constructs a home for a housing consumer.

4. An owner builder may contract a homebuilder for the building of a home for occupation by that person. If someone builds himself a home, lives in it and later on sells it, the mere fact that the house is still new does not suddenly mean that for purposes of this Act, the seller of that house suddenly becomes a homebuilder.

5. “Occupation” is either the date that the housing consumer who first gets the home, accepts it as is by signing a document confirming the acceptance, this is  known as a “happy letter”, this is needed by banks before they will pay out the loan on a bond that was registered for a new home, or the certificate of occupancy issued by a local authority in terms of the National Building Regulations and Building Standards Act of 1977.

6. By signing the acceptance document you take complete ownership of the house and you do not have to physically move in to “occupy” the house for the purposes of the Act.

7. Most important is the part of the Act that states that no person shall carry on the business of a home builder, or receive any remuneration from any agreement with a housing consumer in respect of the sale or construction of a home, unless that person is a registered homebuilder with the NHBRC.

8. If anyone or any company wants to do any sort of building work, they  MUST first be registered with the NHBRC. Before they start work or accept any payment of any kind for the project.

If a builder has finished your entire house for you, and if they are not registered with the NHBRC, you don’t need to pay them a cent. Be aware that you will have to prove that did not know that the builder was not registered from the start otherwise you might  also be found to be complicit in breaking the law.

You can read more about the NHBRC here: national-home-builders-registration-council

Here is a copy of the Act:

Download (PDF, 243KB)

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  44 Responses to “Housing Consumers Protection Measures Act”

Comments (44)
  1. Good Day,

    Hope all is well. I have applied for a new development house last year November 2015 and everything was approved. I signed with the attorneys in February 2016 and was promised to move in by June 2016. I then enquired in July how far is the building project and to my surprise i was told there was a hold up due to rates clearance. Up to now the house is still not built. Can i cancel and re-apply with another agent or go to another area? What are my consumer rights and how do i practice them?
    I really feel drained.

    Kindly reply to my email: jacobethm31@gmail.com

    Kind Regards

    Jacobeth

    • I don’t have any specific knowledge of the relevant legislation. I imagine you could cancel, but rather get an attorney to do the cancellation for you.

  2. We contracted Witch Rooms to do a first floor timber frame build for us. We also contracted them to renovate our ground floor.

    The build started in May 2015 and was still on-going at the start of builders holiday December 2015. They came back with one person in January to sort out a mammoth snag list. We realised they had no intention of getting their work up to standard. We had no choice but to go to arbitration.

    As we entered arbitration, Witch Rooms, Mr Vincent Menge, went into liquidation.

    We have a top engineering specialist who has assessed our build and found it to be substantially under specification. So much so, we have to schedule a meeting with The City of Cape Town Council.

    As Witch Rooms have gone into liquidation, we have have next to no options left to rectify. The amount to rectify is substantial.

    We are following one more legal option, so we will see how that pans out.

    We are now R 100 000 poorer for legal fees and consultants. We are R 1.5million poorer for the build and have to face another R 800 000 at least to re-build the mess they have left for us.

    Who do we report Witch Rooms too. They hold a NHBRC certificate, which means nothing to us as our build was an extension. How do they still get this certificate to operate when they open and close businesses all the time to avoid paying for seriously bad workmanship, the defects are a horror story.

    These people have to be stopped!

    • If the had an NHBRC certificate it will now be null and void because they went into liquidation. I’m really not sure of the legal implications, but I’m sure that it isn’t legal to simply start up another business. Do you know if the business was registered with CIPC? If so Mr Vincent Menge is unlikely to be allowed to start up another legit business. The same would apply to the NHBRC. I really don’t know what to suggest other than to try and keep track of what he and anyone else involved in management of the business does in future. Then you can take legal action.

  3. We have purchased a property from a developer – 2012, all was well until we started getting mould mites mould growth etc only to be told that there is 70% water ingress in the building, we are now in a place where the developer is fixing all challenges with in the building (sectional title) however the workmanship is now shoddy with all the mould etc our furniture beddiing etc was damaged they were going to replace but now advised they will not, they are using strong arm tactics by sending us lawyers letters and trying to bully us into just accepting what they want as final. what can i do, i am at my wits end now and we are paying for the unit for the last 8 months with no compensation and a job that was going to take 9 weeks now into the 6th month of the workmanship.

    • Your house should be covered by the NHBRC five year warranty! If the developer does not belong to the NHBRC and the house wasn’t enrolled, then he’s in more trouble than he knows. Contact the NHBRC as a matter of urgency.

  4. I Paid a Construction Company called Lindomotion Projects PTY LTD to build a two room and a garage in July. The construction was supposed to take 2 months as per the agreement but to date, the builder has not completed the work and when attempts are made to get hold of him he does not answer or return the calls. I have since referred the matter to the lawyers and was advised to contact NHBRC. I requested to be provided with an email address where I can refer my matter please.

    • I’m afraid your lawyer gave you the incorrect information. The NHBRC will only deal with NEW houses that have been registered with them and the fees and inspections done up-to-date. You need to contact the MBA (Master Builders Association) they are the ones that will deal with members that renege on their contracts. That is if they are registered with them and are not “bakkie builders”

  5. Do you perhaps have a standard contract template between a builder and owner who wishes to build.

    • Please go to our downloads page: download-regulations and look for BASIC BUILDING CONTRACT-NHBRC, there are other examples for you as well.

  6. Hi, would someone be able to clarify exactly why having to register with NHBRC is a requirement to build. If theoretically I wish to build my own home for cash and I comply with all the building regulations, have municipal building inspectors do periodical inspections and have a structural engineer over see all the building. What, besides having recourse to claims on poor quality workmanship etc, do I need to pay NHBRC for?

    • Mark, the Housing Consumers Protection Measures Act – which is law – requires all commercial builders must register with the NHBRC. However the Act also allows owner builders to apply for an exemption from the NHBRC. This costs nothing, but you need to go into their offices and fill out a form. They will then give you a letter that states you are exempt. If you don’t go through the procedure then they can fine you and halt your build. Another factor to consider is that owner builders are not permitted to sell the houses they build for at least a period of five years. I can forward the documentation from the NHBRC to you if you like – or you can phone them and ask them to email it directly to you.

  7. i had a builder do renovations at my property for a party venue that i was opening, a 3 week job turned into a 9 week job whereby i gave him a time period ( it was the second time) so he never pitched again, he walked away with my 70% deposit and now i am stuck between a hard place and a rock as i dont have an electricity certificate for his work or a certificate for the electricity fence that he half installed, i have not been able to open my business since 12 april due to all the problems and his employees sleeping on my property. i have taken photos of everything not done and the slapgat work that was done. he now says i never read his terms and conditions which is apparantely somewhere on the internet – and never shown to us or brought to our attention – which states that should i give him a time period or ask him to leave – i will be liable for the full amount. he has not even done 30% of the work yet. i dont know what to do now.

    • If he has not given you his terms and conditions, and you haven’t signed them in acceptance, then you are not liable. They should be incorporated in writing in a contract that you should have signed. Don’t pay another cent until the matter is sorted. Frankly it was crazy of you to pay such a high deposit! He needs to be registered – did you even check that before he started work? You probably need to get a lawyer involved, who can write a letter and put him to terms.

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