Registration and enrollment requirements
The Act requires that all homebuilders, including those building their own homes, must register with the National Home Building Regulatory Council (slightly renamed from the previous National Home Builders Registration Council (NHBRC)). The Act further requires that a home to be built must be enrolled with the NHBRC before construction. It is important to note that the Act’s protection and legal requirements extend beyond newly built homes and include renovations, repairs, and extensions. This extension means that the scope of protection under the Act now encompasses a broader range of building projects, providing enhanced protection for homeowners against both minor and major building projects.

Contractual rights and warranties
Chapter VI of the Act sets out key contractual rights and duties to take note of when building a home. The Chapter focuses on the relationship between housing consumers and homebuilders, insofar as it relates to the building of the home. All building contracts are implied to include certain warranties. These warranties guarantee that the builder is properly registered, the home is legally enrolled, and that the home is/will be built properly, meaning the home must be built in a workmanlike way, fit for people to live in, and align with the agreed contract terms, plans, and specifications.

Builder’s obligation to fix defects
The Act makes it compulsory for the homebuilder to fix defects that a housing consumer has requested the builder to fix, at the builder’s own cost and is subject to the limitations and exclusions contemplated in the Act. The type of defects required to be fixed by the builder and within certain time frames are major structural defects, any defects or deviations from the terms of the building contract and roof leaks caused by poor workmanship, design, or materials. If fixing major defects forces the consumer to move out, the builder must also pay for reasonable relocation and accommodation costs.

 

Generally, the building contract may not include a clause that makes payment to the builder dependent on the payer first receiving payment from a third party, except for a home loan. Also, a failure to timely pay your builder without a good reason may result in the builder suspending all work until full payment has been made.

 

An interesting extension from the previous Act, is the requirement in section 83 for a conveyancer to have to establish whether the property relates to a ‘home’ as defined by the Act and which had to be enrolled in terms of the Act, and if not enrolled, the conveyancer will have to inform the Council of this, or risk being reported to the Legal Practice Council. In this way, the conveyancer will indirectly have to police compliance with the Act to transfer a property. 

Although the Act has not yet commenced, given the expanded scope of the Act now also including extensions and renovations as well as personal homebuilders, it may be prudent, before you commence your home building project, to check with your attorney as to the compliance requirements that may apply to your project.

Disclaimer: This article is the personal opinion/view of the author(s) and is not necessarily that of the firm. The content is provided for information only and should not be seen as an exact or complete exposition of the law. Accordingly, no reliance should be placed on the content for any reason whatsoever and no action should be taken on the basis thereof unless its application and accuracy have been confirmed by a legal advisor. The firm and author(s) cannot be held liable for any prejudice or damage resulting from action taken on the basis of this content without further written confirmation by the author(s). 

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