Gauteng Business News

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PROPERTY: Consumers to Protect Themselves Against Rental Scams


Recent Gauteng Business News

THE SUNDAY Times recently reported that yet another unsuspecting couple were recently swindled in an online property scam. Gordon’s Bay businessman Greg von Gossler was alerted by a real estate friend that his house was being advertised for rent on Gumtree, at a very low price. Von Gossler reported the fraudulent advert to the police, but unfortunately the damage was done and a family arrived on his front door to move in, after having paid a R20 000 deposit.

“It is so important for consumers to determine if an estate agent is duly registered with the EAAB, before paying any deposits on any contracts, be it letting or sales contracts”, says Jan le Roux, CEO of REBOSA (Real Estate Business Owners of South Africa). Should a consumer’s deposit be stolen from the trust account of an estate agent, the Fidelity Fund will in due course make good the loss.

Bruce Swain, CEO of Leapfrog Property Group shares that there are many ways of checking whether an estate agent is legitimate:

The estate agent can be asked to supply proof of registration of the EAAB and even proof of the account in question being a trust account - this is actually very important because the Fidelity Fund will not cover theft of fees that have not been deposited into a trust account.
Should the agent’s full name be available registration can be checked on .This however is problematic because the search facility will only operate if the exact full names are available, which is seldom the case. Should the agent however have forwarded a Fidelity Fund Certificate those names will be shown. Even if this is the case, potential buyers and tenants should still confirm that the agent’s registration is still valid as the certificate in itself is not proof of such.

“It is unfortunate that consumers have not taken cognisance of this fact. The Fidelity Fund has been in place since 1976 and estate agents are required, by law, to have their certificates on display and to have them available to show them to consumers on request. This however is very rarely done and it’s regrettable that consumers are afforded this protection and not using it,” believes Swain.

Le Roux points out that the EAAB (the Estate Agency Affairs Board), is partly to blame, as it has more than adequate funds to promote awareness of this to consumers, but has not done so.
“Much as consumers are to blame for not being careful, the EAAB is at fault for not alerting consumers adequately, if at all. It’s nice to note that it was an estate agent that brought the situation to the attention of the landlord. If all else fails consumers are welcome to contact for assistance.”


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