Real estate industry requests essential service status

Deciding which industries can be classified as an essential service and be allowed to continue operating during the nationwide lockdown is no easy task. But, considering that shelter is one of four necessities to human life, along with food, water, and clothing, it seems justifiable to argue that the real estate industry should be allowed to fall under the essential services classification and to continue operating to a certain extent. In fact, many countries around the world, such as Australia and the US, have allowed realtors to operate with limited restrictions.     

For this reason, on 31 March, Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett, wrote to the key decision-maker regarding which industry should be declared an essential service, the Minister of DTI & member of the National Command Council, Ebrahim Patel. On 1 April, a similarly worded letter was sent by REBOSA to the National Command Council requesting certain real estate-related services be declared essential. RE/MAX SA partner, BetterBond and their direct competitor Ooba have also written to the National Command Council to lobby for the reinstatement of these services. To date, DTI has written back to acknowledge receipt and had stated that the request is being considered.

“While I am cognisant and mindful of the risks associated with the continued spread of the COVID-19 virus, I am equally concerned for the many families that find themselves in a position in which they are unable to access the finance they were relying on due to 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 during this period,” Goslett explains.

In his letter, Goslett writes the following:

“Real Estate Services help people find shelter – be it home ownership or rental – and navigate what is often the biggest financial transaction of most people’s lives. At this very moment, there are countless families in our country that have signed offers to purchase on properties or that have signed rental agreements in recent weeks and months. These families now await transfer of their properties and access to finance, a process that can take weeks and/or months in some cases. Notwithstanding the fact that all other suspensive conditions of these transactions have been met, it is impossible to conclude these transactions due to the need for third party intervention and processes such as rates clearances by municipal departments, bond grants by banking institutions and transfers processed by the Deeds Office. Without these and other necessary real estate related services, ordinary citizens are unable to get access to finance and complete a transaction that provides a basic need: shelter. These are merely examples which would put many South African families at risk if they cannot transact in Real Estate during the State of National Disaster. There are many other scenarios that could leave many in financial ruin or even worse, homeless, if they cannot use Real Estate Services.”

Further in his letter, Goslett highlights that the Real Estate Industry has come a very long way with technology over the past decade. “This has resulted in the industry being able to conduct business with face to face contact at a minimum. Many real estate agents across the country are taking social distancing measures seriously and are trying their best to assist their clients to buy, sell or rent on a virtual basis as far as possible, but the current legislation requires a physical signature of a sale agreement involving an immovable asset, meaning it is impossible to sell a property remotely as the parties have to physically sign the paperwork – a piece of legislation that should really be reviewed to avoid future complications such as this,” the letter states.

“In closing, I would most respectfully like to suggest that we believe that the housing sector will help lead the nation’s economic recovery and provide valuable tax revenue to the Treasury which will most certainly be required to help South Africa out of an economic quagmire. On behalf of all of RE/MAX of Southern Africa’s franchisees, I would therefore, in all humility, like to urge you, in the strongest terms, to include real estate transactions – including their ancillary and supporting services (bonds, title deeds, appraisals, conveyancing services, municipal rates clearances and so forth) as well as rental transactions – in the list of Essential Services, with limited exceptions, to the existing lockdown regulations.”

Should this not be possible, the letter implores the National Command Council at the very least to authorise the reinstatement of the services required to process already concluded real estate transactions. This will not require any customer-based face to face interaction and can be completed almost entirely using digital means. This will enable families who find themselves in a state of flux to conclude their transactions.

In closing, the letter states that RE/MAX of Southern Africa will continue to show support and commitment towards the major responsibility of all South Africans: to fight this invisible enemy with all our might so as to ensure that South Africans remain protected from this deadly pandemic. RE/MAX of Southern Africa also expresses its sincere appreciation towards government for its round-the-clock efforts to keep the people of South Africa safe and to manage the disruption to peoples’ lives and the economy during this difficult and unprecedented time.

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