PROPERTY IN A PANDEMIC
WHAT WE DO KNOW
In this time of so much uncertainty, we thought it might be helpful to look at what we do know. As a boutique real estate agency with a strong history and presence in Constantia, we have been able to respond to the lockdown situation and our client's needs with some speed and agility.
INTEREST RATES
Prime is at the lowest level in forty eight years at 7.25%. This is absolutely unprecedented and has enabled a surge in first time home buyers with Better Bond seeing applications in June 2020 exceeding pre-pandemic times.
BUYERS MARKET
While we were advising our clients some nine months ago that the market was for buyers, the lockdown impact on the economy has further impacted values already reduced by deflation with the greatest drop seen in the most expensive areas.
Constantia currently has 309 properties listed for sale on Property 24 but the following figures available from PropData reveal that over period March to May 2020 only eight properties were sold, six in March, two in April and not one in May. These properties were on the market for eight months and saw a reduction from the listing price of 14% for the properties sold under R5 million (6 sales) and 21.4% for the properties sold above R15 million (2 sales).
However our Constantia teams have sold three properties in June both in the middle and higher market!
DEEDS OFFICE
We cannot deny that the current situation at the Cape Town Deeds Registry is worrying. It is understaffed with approximately 20% of staff at work and has closed twice since re-opening at level 4 with no warning or communication to the legal profession. The Cape Town Attorneys Association approached the High Court which ordered on 19 June that the Deeds Office must re-open, stay open and implement a catch-up on the backlog of deeds. This is welcome as buyers and sellers are still waiting for transactions lodged pre-lockdown to be completed.
DIGITAL DISRUPTION
The move to online platforms started was a pre-pandemic trend with an increase in digital platforms and some of the corporate agencies investing in online businesses. There is no doubt that the pandemic has encouraged this digital disruption and while investment properties are more likely to sell via a wholly online platform and process, technology cannot replace the need for a physical viewing of the bricks and mortar that will become a family home. While virtual tours and online showhouses may be an effective way to highlight homes for sale, we are always mindful of our sellers' emotional and physical safety and will never share information via digital platforms that may make our clients feel vulnerable. Physical viewings will also always be subject to all Covid-safety protocols.