As things stand, the real estate industry cannot operate under level 4 of lockdown restrictions. Yet, real estate is currently in operation in most other countries around the world. Even Italy, an epicentre of the disease, is allowing real estate to operate in the first phase of alert level easing. It seems South Africa is yet again behind on global trends – and this time, the consequences will be detrimental to economic recovery.
“Governments around the world are trying to inject much needed liquidity into the market in order to help the economy through this crisis and on the road to recovery. They recognise the contribution that real estate has in the economy and acknowledge that the economy simply cannot function without this essential service. They also realise that real estate services can be regulated in such a way that its operations pose minimal threat when it comes to the spread of this disease,” explains Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett.
New Zealand, for example, has been a great example of how to approach this pandemic both from a health point of view and responsibly from an economic standpoint. In the real estate sector, emergency regulations have been laid out to dictate how real estate agents may operate based on the different alert levels in place.
“To start, no open homes or show houses will be allowed under Level 4 and should only be allowed at Level 2. Instead, private viewings should be arranged by appointment only and only with buyers who are serious about making an offer on a property or are in the process of making an offer. The number of private viewings can be limited to only two per day and surfaces are required to be cleaned between viewings. Where possible, real estate agents are to encourage online viewing methods (virtual tours, video conferencing software) as an alternative to physical walk-throughs,” Goslett highlights.
Similarly, contracts should not be executed in person with the estate agent present. Goslett suggests that contracts can be drawn up digitally and can be explained to the client using online technology. The signed contracts should then be collected by courier.
Real estate offices would also reopen slowly according to the restrictions laid out at each level of lockdown. During Level 4, the number of people in office at any one time can be restricted to 1/3 of the workforce. Workers must work from home where they can and offices are to remain closed to the public. Clients moving home should be permitted in accordance with government regulations and agents should arrange for sanitized keys to be provided with no physical contact between any party.
There are various other regulations that can be put in place so that real estate services can be reintroduced in such a way as to minimise risk and comply with the various levels of easing lockdown restrictions. In an effort to help government with these regulations, RE/MAX and various other players within the real estate industry, including BetterBond and REBOSA, worked together to formulate the safety measures required to enable real estate to start trading again in a way that addresses the health and safety concerns of all citizens.
“We commit to working with the government to help with the reclassification. The downside risks to our economic recovery are just too large if we do not intervene. There are about 10,000 mortgage bonds that register in the Deeds Office monthly. These mortgage bonds fund a very large percentage of the liquidity that can be injected into the economy. If real estate services cannot operate, our economy loses out on around R20 billion in liquid capital that would have materialised through the registered sales at the Deeds Office. On behalf of the real estate industry and the millions of South African homeowners who cannot access their real estate capital right now, we implore government to reconsider their classification of the real estate industry so that our economy has a fighting chance for recovery,” Goslett concludes. For more industry news, or to get in touch with a real estate professional from the world’s number one brand in real estate.