10% of GDP and thousands of jobs: That’s why we all need real estate to work now

By now most people have seen reports about the real estate industry’s efforts to be allowed to operate fully in Level 4 or at least Level 3 of the lockdown, and not only in Level 2 as is currently proposed.

“And we have made some progress,” notes Berry Everitt, CEO of the Chas Everitt International property group, “with various links in the real estate value chain now being functional again. For example, the deeds offices have re-opened (although with some hiccups) and conveyancers are allowed to work.

“This means they can lodge transfers related to the sales made before and during lockdown by those agents who have determinedly been making use of technology to conclude new leases and home sales even without being able to conduct show days or personal viewings.

“Taking one step back, it is also now possible in most instances for conveyancers to obtain the tax and municipal rates clearance certificates needed to effect those transfers - and in terms of the latest Level 4 directive from the government, tenants, and buyers can even move into their new homes now, as long as they obtain the necessary permits.”

Writing in the latest Property Signposts newsletter, he says that mortgage originators and banks have also been of great assistance to the industry in getting home loan applications processed and approved, and in completing the property valuations necessary for bonds to be approved.

“The fact remains, though, that the whole industry is currently only limping along like the victim of a very serious accident who is grimly and bravely trying to regain full mobility – and the reason is that estate agents and agencies, who are the main drivers of this entire value chain, are not allowed to operate normally.”

What is more, says Everitt, the reason this situation needs to be changed is not only to preserve the livelihoods of around 42 000 registered agents and their families and support staff but to protect a huge percentage of SA’s economy and the real estate industry’s capacity to generate large numbers of much-needed jobs.

“We are not being selfish. The latest statistics from the Deeds Office, StatsSA and the National Credit Regulator show that estate agents facilitate at least R200bn worth of home sales a year, giving direct rise to at least R175bn a year of new home loan business for the banks as well as billions more in transfer duties, legal fees, bond repayments, moving costs and so on.

“Rental and management agents then contribute at least another R1bn to the fiscus and in total, the real estate industry directly accounts for between 8% and 10% of SA’s total GDP, which was R3,1-trillion last year.

“And on top of that, the sector is one of the best financial and employment multipliers, with every home sold or rented also giving rise to many thousands of permanent employment opportunities - and earnings - for those who provide immediate and ongoing services and products such as electrical, gas and plumbing inspections and repairs, additions and alterations, furniture, appliances and delivery, security and maintenance services.”

Then in a thriving property market, he says, the provision of new housing to meet rising demand has the potential to generate even more jobs - in construction, in companies that manufacture and transport building products like cement and bricks, and in other sectors that provide finance, professional services and products to home builders and buyers.

“In short, there is huge power in real estate to immediately start rebuilding the economy and to help many South Africans find decent jobs to support themselves and their families. This is why we want our industry to be allowed to function properly as soon as possible – and we are calling on everyone to support us.” 

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