Stakeholders are calling on the government to give the nod to a phased reopening of the property and construction sectors
The property and construction industries have made urgent submissions to the government to relax the lockdown on “essential” areas without delay.
But they will have to wait until next week to hear whether their industries fall within the Phase 4 easing of restrictions announced by President Cyril Ramaphosa.
Estate agents say the closure of the SA Deeds Office during lockdown has all but strangled the industry. But some doubt it will be reopened soon, since all ancillary staff would also need to be freed from lockdown.
This week, Ramaphosa announced a phased and cautious easing of restrictions from May 1, admitting the country could not sustain a complete lockdown. “People need to generate revenue.”
He announced five levels of restrictions and said the country would move from the most drastic level 5 to level 4, where the opening of some businesses would be allowed. We will only learn next week which these are but few think the Deeds Office and construction will be among them.
This week, the building industry argued the lockdown should be eased to not only protect vulnerable sites and assist unpaid workers, but as major area of job recreation once the pandemic had ended.
“From an employment perspective, getting people back to work in the construction sector is vital,” says Charles Thompson, director of Devmco Group.
“Not opening it has a knock-on effect, from thousands of workers through to estate agents, marketers, property managers and others,” says Thompson.
The industry’s Construction Covid-19 Rapid Response Task Team, representing contractors, developers, construction professionals, suppliers and service providers, wants a phased re-opening of the industry from the beginning of next month, starting with an immediate re-activation of construction sites under way when the lockdown came into effect.
Chair of the team, John Matthews, president of Master Builders South Africa, asserted the industry had the potential to create employment opportunities to cushion the impact of job losses when the lockdown ended.
The industry had submitted a detailed Covid-19 Risk and Mitigation Plan to the Department of Public Works and Infrastructure as part of its motivation for a phased re-opening.
“Continued lack of activity could mean we do not have sites to return to; hence the call for immediate re-activation and the resumption of professional planning, costing and design work.”
The property industry has also asked the government to urgently re-open the deeds office and to categorise the industry as an essential service. It has called for the re-opening of municipalities on a skeleton staff to ensure rates clearances can be issued and that transfers can take place. This would go a long way to ensure the property chain from homeowner to conveyancer attorneys, bond originators, auctioneers and estate agents, is not completely dormant.
They argue the real estate industry – involved in the shelter of South Africans – should be allowed to fall under the essential services classification and to continue operating to a certain extent, say Bill Rawson chairman of Rawson Property Group and Mike Greeff, chief executive of Greeff Christie’s International Real Estate. Re/Max Southern Africa chief executive Adrian Goslett points out many countries, such as Australia and the US, had allowed estate agents to operate with limited restrictions.
Tony Clarke, managing director of Rawson Property Group, says: “Not only can 50 000 estate agents not earn during the lockdown, as the industry is entirely commission-based, the current pipeline is now stuck in the deeds offices and essential cash flow is non-existent. Once the country returns to normal and these estate agents can function again, they will have to wait a further three months or more for payment in respect of sales concluded. The industry simply cannot survive this.”
Goslett adds: “I am concerned for the many families that find themselves in a position in which they are unable to access the finance they were relying on because of the deeds office closure.
“Many purchasers may also find themselves in a position of ‘homelessness’ due to being between transactions. Beyond this are the thousands of real estate practitioners whose income has been reduced to zero.”
Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty says: “We will still go through very tough times but if (Ramaphosa) eases restrictions on certain essential criteria, like re-opening the deeds office, there is certainly light at the end of the tunnel.”