The Housing Consumers Protection Measures Act 95 of 1998 was promulgated to make provision for the protection of housing consumers and to provide for the establishment and functions of the National Home Builders Registration Council (NHBRC). A home builder is anyone who constructs or undertakes to construct a home. A home builder is also one who causes a home to be constructed or constructs a home for the purposes of sale. leasing, renting out or otherwise disposing of such a home.

A home is any dwelling unit constructed or to be constructed for residential purposes or partially for residential purposes and includes a private drainage system, garage or storeroom, permanent outbuilding designed for residential purposes or for a purpose ancillary to residential purposes and a retaining wall, necessary to maintain the structural integrity of the home constructed/acquired under the agreement.

A developer is obliged, for the purposes of the physical construction of homes, to appoint a home builder registered with the NHBRC. As a condition of the Act and the Regulations, all home builders must register with the NHBRC, and enrol all new homes with the NHBRC.

The Objectives of the NHBRC are:

• To represent the interest of housing consumers by providing warranty protection against defined defects in new homes
• To regulate the homebuilding industry,
• To provide protection to housing consumers in respect of the failure of home builders to comply with their obligations in terms of this Act,
• To establish and promote ethical and technical standards in the homebuilding industry,
• To improve structural quality in the interests of housing consumers and the homebuilding industry,
• To promote housing consumer rights and to provide housing consumer information,
• To communicate with and assist home builders to register in terms of this Act, and
• To assist home builders, through training and inspection, to achieve and to maintain satisfactory technical standards of homebuilding.

Upon the conclusion of a Building Contract or Sale agreement, the home builder must give the housing consumer a copy of the signed contract. The home builder must comply with all the obligations under a Building Contract that he or she enters into and may not vary any of the specifications, or any of the agreed terms of the agreement relating to specifications or materials to be used unless the variation and the amount by which the contract price is increased or decreased in consequence thereof are agreed to in a written document which shall be signed by the parties.

The home builder is responsible for enrolling the new home with the NHBRC at least 15 days prior to the commencement of construction and to pay the enrolment fee.

The home builder shall not demand or receive a deposit from a housing consumer for the construction or sale of a home unless a written agreement has been entered into.

The home builder who has concluded a (Housing Contract/) Building Contract must begin building the home on the date stated in the contract, proceed regularly with the building, until the home is completed and complete the home on or before the completion date as agreed in the Building Contract.

The home builder must:(a) immediately issue a receipt for all payments made to him/her by the housing consumer; and (b) issue such receipt on a business document;(c) issue statements which are clear, contain all information and are understandable to the housing consumer.

The home builder is responsible to rectify any non-compliance with the terms, plans and specifications or any deficiency related to design, workmanship or materials. The home builder is responsible rectify any defects related to design, workmanship and materials, which occur within 90 days of occupation and to repair any roof leaks attributable to workmanship, design or materials occurring within 12 months after occupation.

The home builder must provide a five-year warranty on the structural integrity of the new house, i.e. superstructure (walls), substructure (foundations) and private drains, and to rectify major structural defects notified by the housing consumer within five years of the date of occupation caused by non-compliance with the NHBRC Technical Requirements.

The warranty scheme only applies to new houses built by home builders registered with the NHBRC. The enrolment provided by the registered home builder is transferred automatically to anyone who buys the house during the five-year warranty period.

The registered home builder must ensure that both he and the prospective home buyer complete and sign all relevant documents before construction commences and cause the homeowner to sign a letter confirming acceptance of occupation (for building contracts) and forward a copy of this letter to the NHBRC.

The home builder shall also indemnify the housing consumer against any claim arising out of personal injury or damage to property attributable to the negligence or other unlawful conduct of the home builder in the construction of a home for the housing consumer.

A home builder shall attend promptly to a housing consumer's complaint and attend any meeting arranged by a conciliation officer appointed by the NHBRC.

Victor Smith

Membership Manager

Source: Act 95, 1998 Housing Consumers Protection Measures Act, 1998