Imagine this: you’ve just moved into your dream home. Within weeks, water begins seeping through the walls after heavy rain you discover deep cracks creeping along the walls, mould spreading in damp corners, and a simmering boundary dispute with the neighbour. When you contact the seller, you’re told “we didn’t know.” The property practitioner shrugs – “nothing was disclosed.” What seemed like a fair deal has turned into an expensive nightmare.
This is not just a cautionary tale. It is a very real scenario that plays out when one of the most critical documents in any property transaction, the Immovable Property Condition Report, is overlooked, rushed, or completed without due care. Whether you are a seller, buyer, landlord, tenant, or property practitioner, understanding this form, and ensuring it is completed properly, can prevent devastating financial and legal consequences.
What Is the Immovable Property Condition Report?
The Immovable Property Condition Report, also referred to as the mandatory disclosure form, is a legally prescribed document under Section 67 of the Property Practitioners Act, 2019. In terms of the Act, this form must be fully completed and signed by the seller (or lessor, in the case of leases) before a property practitioner may accept a mandate to market the property.
Key obligations Property Practitioners have with regards to the Mandatory Disclosure Form include:
- They may not accept a mandate unless the Seller or Lessor of the property have provided them with a fully completed and signed mandatory disclosure form in the prescribed form.
- They must provide a copy of the completed form to prospective purchasers or lessees who intend to make an offer for the purchase or lease of a property;
- The completed form, signed by all relevant parties, must also be attached to any agreement of sale or lease of a property, and forms an integral part of that agreement.
If such a disclosure form was not completed, signed or attached, the agreement must be interpreted as if no defects or deficiencies of the property were disclosed to the purchaser or lessee. Such a situation puts enormous risk on the property practitioner and/or seller and landlord, as they may in such an instance be held liable by an affected consumer.
Patent vs Latent Defects
The disclosure form requires the seller to confirm whether they are aware of certain defects in the property. These defects are accounted for in the form by the Seller answering a prescribed set of questions.
Not everything that buyers or sellers may think of as a defect constitutes a defect in terms of the mandatory disclosure form. In the form it defines a defect as: “any condition, whether latent or patent, that would or could have a significant deleterious or adverse impact on, or affect, the value of the property, that would or could significantly impair or impact upon the health or safety of any future occupants of the property or that, if not repaired, removed, or replaced, would or could significantly shorten or adversely affect the expected normal lifespan of the Property.”
- Patent defects are obvious issues that can be identified by a reasonably careful inspection – such as cracks in a wall or broken tiles. These are defects that a buyer can and should notice when viewing the property.
- Latent defects, however, are hidden and not visible to the naked eye – for example, faulty wiring inside the walls, rising damp masked by fresh paint, or defective foundations. These are often the source of disputes, as they can cost thousands to repair and may only appear months after occupation
It is also important to note that the form does not constitute a guarantee or warranty of any kind by the owner of the Property or by the property practitioners representing that owner in any transaction. It should therefore, not be regarded as a substitute for any inspections or warranties that prospective purchasers / prospective lessees may wish to obtain prior to concluding an agreement of sale / agreement of lease in respect of the Property.
Sellers are not expected to guarantee a “perfect” property, but it is advised that they should disclose defects they are aware of, whether latent or patent. Failure to do so may amount to misrepresentation, which can possibly result in legal claims after the property has changed hands.
Why This Form Matters
The disclosure form is sometimes treated as “just another piece of admin.” In reality, it is arguably the one of the most important documents in any property agreement. Here’s why:
- Legal Protection – For sellers, it provides proof of what was disclosed, protecting them from future claims of non-disclosure. For buyers, it ensures they have been informed before committing.
- Transparency and Trust – A well-completed form fosters trust between parties. Buyers feel more confident making an offer, and sellers avoid disputes later.
- Risk Reduction for Agents – Property practitioners who fail to comply can face sanctions from the Property Practitioners Regulatory Authority (PPRA) and even civil claims from affected consumers.
- Better Negotiations – When defects are known upfront, they can be factored into the sale price or conditions of the agreement, avoiding nasty surprises later.
The Do’s and Don’ts
Do:
- Complete the form with absolute honesty – “I don’t know” is acceptable if true, but withholding information is not.
- Attach the signed form to the sale or lease agreement every time.
- Encourage buyers to conduct their own professional inspections, even if the form is completed.
- The property practitioner or owner should ensure that the disclosure form is available during viewings, enabling prospective buyers or tenants to review any visible defects and raise questions about issues that may influence their decision to submit an offer or proceed with a lease.
Don’t:
- Alter or add to the prescribed format . The PPRA requires it to remain unchanged.
- Accept a mandate as a property practitioner without the form, as it is unlawful.
- Assume the form replaces an independent inspection. It is a disclosure, not a guarantee.
When the Form Is Not Completed Consider a seller who neglects to complete the mandatory disclosure form. He does inform the buyer verbally that there are issues with the foundation of the property, but this is not documented in the agreement of sale. Within a year, the walls begin to crack, and repair estimates reach hundreds of thousands of rand.
Because the disclosure form was not attached, the agreement is interpreted as if no defects were disclosed at all. The buyer sues, not only the seller but also the property practitioner, who is held liable for failing to follow the Act. The result? Litigation, financial loss, reputational damage, and a sale that ends in bitterness instead of satisfaction.
This is exactly what the mandatory disclosure form is designed to prevent.
Going Beyond Compliance
While the Act provides minimum legal requirements, best practice goes further. Sellers should view the disclosure form not as a burden, but as an opportunity to demonstrate honesty. Buyers should never rely solely on it, but rather combine it with professional inspections. Agents should treat it as a cornerstone of their fiduciary duty to protect clients and act transparently.
The ultimate goal? To ensure that property transactions are fair, informed, and dispute-free.
Learn More in Our Podcast
We recently discussed this very topic on our podcast, unpacking why the disclosure form is so powerful, common mistakes sellers and agents make, and how it protects everyone involved. You can listen to the episode here: Podcast on the Immovable Property Condition Report.
Final Thoughts
In property, surprises are rarely good. The Immovable Property Condition Report is not paperwork to be rushed through or ignored, it is a shield for sellers, a safeguard for buyers, and a compliance requirement for agents.
Handled properly, it ensures transparency, builds trust, and creates smoother transactions. Ignored, it can unravel deals, spark lawsuits, and leave all parties counting the cost.
So next time you buy, sell, rent, or let – remember: this single document could be the most important page in the entire agreement.
