Answer to a question from a reader

Can I build and sell a house if it complies with CIDB and NHBRC regulations?

The short answer

Building homes is outside the scope of the CIDB but you need to register with the NHBRC before starting construction.

The whole question

Dear Athalie

If I buy a vacant lot in a developed area and build a house that complies with CIDB and NHBRC regulations, can I sell it?

The long answer

CIDB (the Construction Industry Development Board) is what is called a Schedule 3A public entity, and is set up for contractors who want to tender for construction projects in the public sector. It is compulsory for those contractors to register with CIDB. But building of homes is outside the CIDB’s scope of work.

Home building falls under the National Home Builders Regulatory Council (NHBRC) and contractors who work on public housing sector projects don’t need to be registered with CIBD.

The NHBRC is a Section 21 non-profit organisation that was set up to establish a registration process for all home builders and contractors and to have a Defects Warranty Scheme for all new homes built by their registered members, to protect consumers. Since 1999, it has been compulsory for all home builders to register with the NHBRC. Banks are not allowed to lend money for a house bond unless the builder is registered with the NHBRC. Also, a conveyancing attorney is not allowed to register a deed for the house without NHBRC registration by the builder.

To register with the NHBRC, builders have to have the appropriate technical and construction skills to build a house, as well as enough money and management ability “to carry on a business without exposing ‘housing consumers’ to unacceptable risks.” The initial NHBRC application fee is R745.61, which is non-refundable. The home builder has to enrol the house on NHBRC's database 15 days before starting to build it and must have the certificate of proof of enrolment before starting any building.

The NHBRC inspects the home at key stages of construction. If the builder has deviated from the Home Building Manual, NHBRC will issue a non-compliance order to the builder who must rectify the identified non-compliance within a reasonable time frame. If the builder won’t or can’t rectify it, the NHBRC will stop construction and institute its builder disciplinary process.  

The home buyer is given a 5-year warranty cover for an enrolled house so that the NHBRC can follow up on minor and major building faults.

You are not allowed to build or sell houses unless you are registered with the NHRBC. But if you are registered with the NHBRC, I see no reason why you can’t go ahead and sell your house, once it has passed all the required tests / inspections.

I hope that covers your question. This is the toll-free number of the NHBRC in case you need it: 0800 200 824.

Wishing you the best,

Answered on Aug. 2, 2022, 3:11 p.m.

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