Despite the CSOS directive, HOAs remain an issue in South Africa as unfair practices, fees, and weak enforcement continue to affect the property sector.
Introduction: Why HOAs Remain an Issue Despite the CSOS Directive
Homeowners’ Associations (HOAs) remain an issue in South Africa even after the CSOS directive of 2025 attempted to curb restrictive practices. While the directive clearly outlawed unfair rules that favor specific property practitioners, the reality on the ground shows little has changed. Estate agents continue paying hidden accreditation fees, homeowners face limited choices, and the industry struggles with compliance.
This article explores 10 strong reasons why HOAs remain an issue, shedding light on how these practices undermine transformation, restrict competition, and create a culture of selective enforcement.
1. The Root of the Problem: HOA Accreditation Fees
At the heart of the dispute lies the controversial practice of charging accreditation or marketing fees. Many HOAs still demand that property practitioners pay substantial sums before they can sell or lease units within community schemes.
These fees, which were meant to be banned by the CSOS directive, not only limit access to the market but also create a monopoly for those who can afford to pay. Smaller and emerging agents, particularly black-owned firms, are excluded, reinforcing inequality in the real estate sector.
2. The CSOS Directive: What It Tried to Achieve
The CSOS Practice Directive 1 of 2025 explicitly declared that rules restricting property owners from choosing their own practitioners are discriminatory and unreasonable. Its purpose was to dismantle unfair barriers and empower homeowners to select agents freely.
Yet, despite this clear instruction, many HOAs simply renamed the fees or disguised them under different categories. Instead of eliminating the issue, the directive inadvertently created loopholes that are being exploited across the country.
3. Weak Enforcement from Regulatory Bodies
Although the Property Practitioners Regulatory Authority (PPRA) has the legal mandate to enforce compliance, enforcement has been inconsistent. Some agents have been fined R5,000 for contravening the law, but many others continue to operate unchecked.
Industry leaders argue that these fines are insufficient deterrents. For agents earning commissions worth hundreds of thousands of rand, paying a minor penalty is simply the cost of doing business. This lack of meaningful enforcement allows the problem to persist.
4. The Culture of “Better to Ask Forgiveness than Permission”
In the current environment, many estate agents adopt a strategy of ignoring compliance notices, confident that enforcement will be weak or delayed. Paying a small fine after the fact is considered more profitable than losing lucrative business opportunities in high-demand estates.
This mentality has entrenched a dangerous culture where breaking the law is seen as less risky than following it. As a result, HOAs remain an issue, with unfair practices normalized in the industry.
5. Transformation at Risk: The Exclusion of Black Estate Agencies
One of the most pressing concerns is the effect on transformation. The Property Practitioners Act of 2022 was designed to promote inclusivity and give new entrants, particularly black-owned agencies, greater access to the market.
However, when HOAs impose hidden barriers like accreditation fees, the very agents meant to benefit from transformation policies are locked out. Visiting HOA websites often reveals a limited representation of black estate agencies, highlighting how entrenched the problem has become.
6. The Homeowners’ Perspective: Rights Undermined
It is not only estate agents who suffer. Homeowners themselves are directly affected when their right to freely choose a property practitioner is restricted. Many HOAs pressure owners into using a limited pool of “approved” agents, which diminishes competition and can reduce property values.
This restriction undermines the principle of ownership, turning what should be a personal right into a controlled privilege. The CSOS directive recognized this but has failed to translate the principle into practice.
7. Industry Leaders Sound the Alarm
Prominent voices such as Jan le Roux, Chief Executive of Rebosa, have repeatedly warned that weak enforcement is undermining transformation efforts. Le Roux argues that unless the PPRA publishes the names of transgressing agents and enforces penalties vigorously, the industry will remain stuck in a cycle of non-compliance.
The fact that illegal practices remain visible across community schemes demonstrates the urgent need for stronger action. Without accountability, HOAs remain an issue that threatens the credibility of the real estate sector.
8. Regulatory Silence and Limited Transparency
Another factor fueling the problem is the lack of transparency. While the law empowers regulators to disclose the names of agents found guilty of violations, this information is seldom made public.
Without visible consequences, agents believe the risk of detection is minimal. Transparency would serve as both a deterrent and a signal to homeowners that the law is being upheld. Instead, silence from regulators creates uncertainty and suspicion.
9. The Need for Stronger Action and Clear Communication
Experts agree that the PPRA and CSOS must adopt a more proactive approach. Clear communication, stronger penalties, and consistent enforcement are critical if the problem is to be resolved. Publishing lists of guilty agents, imposing higher fines, and suspending repeat offenders could send a powerful message.
Until such steps are taken, the status quo will persist, and HOAs remain an issue that undermines both property rights and industry transformation.
For a broader perspective on how regulatory gaps affect industries worldwide, see this analysis on regulatory enforcement.
10. The Way Forward: Restoring Trust and Fairness
The solution lies in a multi-pronged strategy:
- Stronger regulatory enforcement with penalties that outweigh potential profits
- Greater transparency by publishing the names of transgressing agents
- Education for homeowners so they understand their rights
- Commitment to transformation to ensure black-owned agencies can compete fairly
- Clearer legislation to close loopholes exploited by HOAs
By addressing these areas, South Africa can build a real estate sector that is both fair and inclusive. Without decisive action, however, HOAs will continue to exploit their power, and homeowners will remain trapped in an unfair system.
Conclusion: Why HOAs Remain an Issue
Despite the CSOS directive, the reality is clear: HOAs remain an issue because enforcement is weak, transparency is lacking, and illegal practices persist under new guises. For transformation to succeed and property rights to be protected, regulators must act decisively.
The fight against unfair HOA practices is not merely a legal matter; it is a test of whether South Africa can create a property industry that is just, inclusive, and accountable.
