After almost three months without the ability to buy and sell real estate, the property market has seen a flurry of activity since real estate became fully operational again. This resulted in the largest real estate group in Southern Africa, RE/MAX SA, reporting a record-high sales month of 2.38 billion in June. Certain regions within the group, namely KZN among others, stand out as being the forerunners for this recovery.
“Some of our offices have done three times their monthly average. Some agents are putting phenomenal numbers together. There is an agent in Pretoria that did 43 sales in six weeks. That is more than a property sold a day for six weeks. I am so proud of our team that they have the grit, the determination, the resilience, and the bounce-back to be able to achieve something like this,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
This recovery is much needed to correct the drop in the year-to-date sales figures for the group that stemmed from the inability to operate at Alert Level 5 and 4. Between Jan-July 2020, RE/MAX of Southern Africa reflected an average drop of 19% in reported sales figures across all regions. One the worst affected regions was the Western and Northern Cape Region, recounting a 29% drop in reported sales. The Eastern Cape and Garden Route Region followed just behind at a 23% drop.
On the other hand, the RE/MAX Offices in the KZN region recounted just a 12% drop in reported sales. According to Grant Gavin, Broker/Owner of RE/MAX Panache operating in Durban North, everything went quiet in the few months of lockdown. “In the second week of lockdown, I asked our agents to rate activity on enquires on a scale of 0-10, with zero being ‘dead quiet’ and 10 being ‘I cannot keep up’. Most of the office replied with a two or a three. There definitely were much fewer enquiries and during some periods, none at all. Our sales reflected this too. In April we did 12% of normal sales, and May we did just 25% of normal sales,” he explains.
But, when real estate could fully operate again in June, Gavin explains that there was an opening of the floodgates. “We did notice a shift in May as enquiries slowly increased and more homes were being listed, but our sales in June was a record month. In fact, it was the best month in the history of our office: R180 Million in sales. This was the result of many active buyers not being able to get out during lockdown levels 4 and 5,” Gavin explains.
After Alert Level 3, a lot of stock came onto the market, but the team at RE/MAX Panache have since been able to sell most of it. In fact, Gavin says that with so many homes sold in recent times, the market may even be shifting slightly towards the seller. “As more and more of the stock was sold, we started experiencing more competition for homes, resulting in more back-up offers on properties. We have not experienced this level of competition for a long time,” says Gavin.
The low interest rate levels are also encouraging many first-time buyers to invest in real estate now. While many buyers in his area are families, Gavin recommends that there are some great opportunities for first-time buyers in markets like Gateway and Umhlanga New Town centre, Sunningdale and Umgeni Park.
As great as June has been in terms of generating sales in KZN and across the rest of the country, Goslett is cognisant that there is still a long year ahead and that tough times are still to come in September, October, and November when UIF and other economic relief starts running out. “We need to continue to work hard and serve our clients as best possible to ensure that we continue along the path towards recovery, because I do see tough times ahead,” he concludes.