LOCKDOWN – Effects on Real Estate & the Economy
President Cyril Ramaphosa’s address to the nation called the country into a full lockdown to contain the spread of COVID-19. This decision will cause all non-essential businesses to shut down all face-to-face operations until the situation can be contained.
“I commend the president for taking such proactive measures against this pandemic. After speaking to Dario Castiglia, Regional Owner for RE/MAX Italy, I was convinced and firmly believe that a full lockdown is the answer to flattening the contamination curve and making sure that our hospitals do not get overrun by new cases,” says Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett.
While Goslett welcomes the lockdown from a health and safety perspective, he also recognises the strain this lockdown will put on businesses and the greater economy. “This lockdown will bring the economy to a standstill if businesses fail to get creative with their offerings and their operations in order to remain productive within this situation. To protect our economy, I would encourage all business owners to use this time wisely. If the business is unable to generate income over this period, use the time to develop your business goals and to work out a plan on how to recover once things return to normal. As business owners, it is our responsibility to do what we can to make sure our economy keeps on running,” says Goslett.
Similarly, Goslett encourages real estate professionals to do what they can to protect the state of the housing market. “The housing market will inevitably take a knock over this time, especially if the Deeds Offices close and property transfers are delayed until they reopen. Many buyers will also be reluctant to sign an OTP without ever seeing the home in person.”
“But, there are things real estate professionals can do to minimise the downsides of this situation. Agents should still be following up with clients via virtual tours and face-time conversations, trying to line up as many sales as possible so that they can hit the ground running as soon as the lockdown period is over. To protect buyers who purchase homes over this time, agents can draft OTPs with a suspensive condition that stipulates that the purchase will only go ahead once the home has passed a physical home inspection which can be conducted once the lockdown has been lifted.”
In summary, Goslett encourages all business owners to join efforts in operating responsibly and productively during these unique circumstances. “I back the president in his decision to launch a full lockdown. I believe that it is the most responsible course of action in response to this pandemic. As business owners and entrepreneurs, it is our duty to support this decision while doing what we can to keep our economy afloat by planning for businesses continuity after this period of isolation is over,” he concludes.
Source: RE/MAX of Southern Africa