Property in the time of lockdown – here’s what we can expect
In accordance with President Cyril Ramaphosa's directive, the country went into lockdown at 23:59 last night. We believe this to be the right thing to do to curb the spread of the coronavirus and mitigate the economic impact that will invariably result.
A number of questions are being raised about the pandemic's impact on the property market and, while they're all valid, it's important to acknowledge that the real estate market is keenly affected by the overall health of the economy, consumer confidence, and levels of unemployment. This means that major disruptions in other sectors will certainly have some impact on the property market but the degree to which this will happen is unknown at this point.
We can take some comfort in the fact that, historically, property has shown to be a far more resilient investment type than most. To date, property has remained fairly stable while equities, for example, have suffered incomparably.
Irrespective of the impact the virus has on society, people will still need accommodation to ensure the ongoing safety of their families, which offers a measure of security in terms of a property investment holding ground in times of turmoil.
The Deeds Offices will be closed causing delays with property transfers and bond registrations but some good news is that the major banks will be processing bond applications albeit at a much slower pace due to skeleton staff. For those buyers wanting to make an offer on a home during the current "Buyer's Market", we encourage you to prepare yourself financially by getting pre-approved and ensuring that you are financially ready to secure bond finance. Although show houses are no longer possible there are a number of estate agents showing houses through the use of 3D technology and property portals will continue to add new listings to their portals regularly.
These are unprecedented times in which it is crucial to retain perspective, to stay calm, and to focus on the things we can control. We anticipate that some banks may look at providing payment holidays on bonds for those who need it, and we're grateful for the small business relief fund that has already been put in place to ease the economic burden on those whose business will suffer under lockdown.
At this stage we must caution against panic, and, while we need to take the necessary measures in order to protect ourselves and our families, we also need to think as rationally as possible about property, and about investments in general.