How Covid-19 Is Affecting Real Estate Business

By Ngozi Asoya (Larryhappiday)

If you’re NOT doing real estate, you ain’t in business.

Real estate is diversified. Covid-19 the terror sickness of 2020 has shrunk some sections of the business but others have continued to grow slightly. Overall, it is a mixed bag.

The Many Strands of Real Estate

When we talk real estate, we are referring to the following businesses:
1. Private homes
2. Residential rented apartments
3. Commercial rented property
4. Building and construction
5. Luxury Apartments
6. Rental Tourism accommodation
7. Investments in any or all of the above
8. Agency
9. Marketing & sales
10. Seasonal property rental
11. Realtors training like the one provided by RealtorPro
12. Surveys
13. Urban Development
14. Architecture & Designing
15. Financing
16. Building Materials manufacturing
17. Building materials distribution and sales

Image generated from Entity Explorer

Each of these boasts of sublets and branches. An understanding of the effect of Covid-19 pandemic on real estate will have to touch each of these segments before a holistic assessment can be made.

PRIVATE HOMES.

This can be discussed under urban homes and rural homes. The need for comfortable and conducive homes have never been more acute. Whereas, home and office lives were hitherto split, they are converging in an accelerated manner. Home construction and equipment especially with renovations are high. It has become necessary to carve out conducive work spaces in most urban homes. Furthermore, most urban homes are reliant on imported materials mostly from Asia and Europe. The accessories market has as channels Italy, Turkey, UAE, India and China. With the Lockdown of the manufacturing sectors in these countries orders are hanging in the air. This has created openings for local improvisation. Purchasing power issues have significant effect on rural homes acquisition and rental.

RESIDENTIAL RENTED APARTMENTS

Rental property owners are scratching their heads and wondering when tenants would resume and paying their rents. The worst hit are the short let apartments that rely on weekly, daily or monthly rents. There are difficulty in getting new tenants and in collecting rents from existing tenants, who are mostly unskilled daily paid workers.

COMMERCIAL RENTED PROPERTY

Property owners in this category are mostly bulk rent collectors. That means they give out their premises to users who pay before use. Commercial properties mostly charged per annum and would not be too pressed because most tenants would still have subsisting rents paid over one year. Those who were entering this sector before the Covid-19 pandemic and lockdown began would be hard put to explain their hard luck as borrowing obligations may continue unabated and anticipated inflows may be stymied.

LUXURY APARTMENTS

Luxury apartments are like commercial property. The difference being that these apartments are often occupied by mobile expats who took off enmass during the onset of lockdown in March and early April. Many luxury estates are lying fallow although some had been paid for before the onset of Covid-19.

BUILDING AND CONSTRUCTION

Building and construction is one of the worst hit. This sector relies on daily paid workers who have been ensconced in their homes restricted by government orders to lockdown and to observe no close social proximity measures. Contractors are then sequestered with projects that they are not executing and the risk of cost creeps.

RENTAL TOURISM PROPERTIES

Owners and builders in this category are still considering where the uppercut that left them sprawling came from. Hotels, event centres, motels, and clubs are in this category. Whereas they are already devastated enough with lost revenues due to complete lockdown of their facilities, consumables and other credit facilities are falling due. Some may expire before the total easing of restrictions. New property owners or those who had commenced construction have huge liabilities in terms of altered profitability questions and projections as well cost and project creeps.

INVESTMENTS

For those who are short-term investors, not much may be lost. However those huge short-term investors who have already made commitments have something else coming. If they had obtained facilities from commercial lenders at commercial rates, there will be a lot of shillying and shallying to do.

AGENCY

Millions of small agents occupy the space between renters and owners all over the world. With no significant fresh investment flowing into the economy, this is a complete lull. Collecting due rents are problematic and getting new tenants neigh impossible. Many in his sector are literally starving. Specialisation in this category include: agents specializing in every sector of the industry such brokerage, management, rental etc.

MARKETING & SALES

This can be divided into three segments: land, built-up properties, creatives supporting the selling process. In the last category are real estate digital advert creators, print media including banners and newspapers and graphic experts providing marketing paraphernalia. There is gross lull in the acquisition of landed property but smart investors are already buying heavily because this is one of the most likely to recover quickly. Buyers also have immense negotiating powers right now and could strike smart deals if they have experienced realtors to work with. Furthermore, most people of influence and wide networth are likely to flood this sector soon as many will seek to trade their social assets for a new life. (This is one area where RealtorPro excels). Recently out of job workers and high networth paid employees should explore this option of maintaining the lifestyle they have already built over the years.

SEASONAL PROPERTY RENTAL

Entertainment and tourism assets have seasonal patrons who keep them alive especially through the summer. Bulk orders are being cancelled leaving supply chain providers stranded. Although this is low volume activity, it compares in turnover with most other segments. Activities here include: resort town sourcing, maintenance,  redevelopment and financing.

REALTOR TRAINING

This is  an urgent need for new realtors in the light of increasing awareness of the need to own private and commercial properties. Besides, given the changing landscape of real estate business, practising realtors are seeking more elevated information products that will give them the edge and stand them out from the crowd. Real estate training for sellers, managers and even buyers are being developed. Talk to RealtorPro for more.

ARCHITECTURE

This is the most fecund season for creatives. Being the moment when property owners are renovating or planning their new projects, architects will find this season full of activities. What do architects do?

FINANCE

Institutions engaged in funding real estate are having two problems on their necks: defaults and idle funds. There are a lot of idle resources looking for users without any borrowers. Similarly, those who borrowed are unable to pay because there are no economic activities to fund repayments. So they are battling with insurance issues, repayment issues and idle funds. Nothing ails a lender like having resources that no one is taking.  Other financial transactions handled include brokerage, lending, risk analysis, construction and mortgage. Everyone in the building industry chain requires one form of credit or another.

MANUFACTURERS

There a multiplicity of manufacturers in this segment. For instance, we have  interior and exterior materials manufacture. They include facade, wall, glass, aluminium, steel, wood, brick, stone, iron, etc.  Most building products don’t have short expiry dates so they do not have much to worry about that. However, finances tied to materials procurement, staff salaries, even though they aren’t working and overflowing inventories are their major concerns.

LAWYERS

Some of the activities done by lawyers in the property business

Property law encompasses conveyancing, inheritance, investigation, inspection, contract, attorney services, legal advise, land purchase etc. I have client who just finished paying for his property. He went through his lawyers and I’m looking forward to meeting him person during his allocation which comes up in a few days time. That’s what property lawyers can do. Take away the fears of property investment by scrutinizing offers and supervising purchase.

In conclusion, it is clear that there are many areas where people can apply their skills and experiences in the real estate sector. They only need guidance.

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How to Exorcise the Covid-19 Demon of Fear

By Ngozi Asoya (Larryhappiday)

Catholic priest, Rev. Jude Ofuani recently asked a very fundamental question concerning the most confounding issue of our time Covid-19 disease. In his article Defeating Covid-19 Demons, he had asked the question that is on every living soul’s lips: how do we confront the fears of Covid-19 pandemic? While reading that article, I found that I needed to talk more about this challenge because without answering that question satisfactorily, there looms another epidemic. The catastrophic epidemic of mental or humongous psychotic dimensions that our entire stock of global psychiatrists are not equipped to handle. How? There are currently one psychiatrist to 10,000 patients and 264 million depression sufferers globally before the pandemic. Here lies the need to drive in the black goat before darkness envelopes the land.

Is there a threat of Mental Illness?

The World Health Organisation (WHO) has already warned of an impending mental health explosion. In a recent release by the global health body, it was shown that our world is seating on a tinderbox of anxiety, depression and schizophrenia occasioned by the unprecedented health scare that accompanied the Covid-19 pandemic. This is contained in reports published in the middle of May 2020. It states: “the mental health and wellbeing of whole societies have been severely impacted by this (Covid-19) crisis and are a priority to be addressed urgently.”  So its safe to conclude that Father Jude Ofuani has a point about the rising sea of gloom threatening to eclipse mankind. This is because it is important to identify the fear and to name it before it assumes a life of its own swallowing the overwhelmed public in its destructive wake.

Identifying Covid-19 Fears

Having stated the above, I intend to further the discussion by the following steps:

1. Classifying the fears that we fear
2. Describing those fears and how they impact us as individuals in the shot and long run and
3. Suggesting ways of tackling the fears fearlessly.

Classification of Covid-19 Related Fears

The fears that the pandemic engendered may be classified into the following broad groups:

• Money Fears
• Job / Career Fears
• Loss of Social Status
• Truncated or Failed Obligations
• Fear of Hopelessness
• Fear of Success
• Spiritual / Religious Fears. Now let’s consider each of these in more details.

Money Fears

Both businesses and workers are confronted by this reality. Even medical and health workers in some states in Nigeria have been forced to down tools in this period of emergency because their allowances were not being paid or not being paid on time. Concern over money is a very real concern. The bulk of workers and Small and Medium Enterprises (SMEs) that constitute the bulk of employers have not earned a dime since March when the pandemic was declared. How have they survived so far? By drawing down on their savings, by borrowing or by government hand outs. The last has been more of a fiction than of fact for majority of people. Where there are government provisions for weathering the Covid-19 storm, accessing such resources have become another mountain of hurdles altogether. So people are worried stiff about this fact: “HOW DO WE SURVIVE?”

Job / Career Fears

The final tally is yet to be taken on the effect of Covid-19 on business. However, it is obvious, as seen in the case of Access Bank that many companies have downsized their workforce.

Speaking on her plans to reduce her workforce, the banks managing director had indicated that as much as 75% of their workforce would be pruned. 75%! Furthermore, he indicated that there was going to be pay cut for those who would be left beginning from himself. That’s the reality of the job market occasioned by the unprecedented health scare.

Unemployment, underpayment and job uncertainty are a drain on human psyches already stretched thin by the mishmash of issues that Covid-19 sired. How to cope with those damages with a renewed assault on people by the loss of jobs will be a torrent of mental torture that should be managed properly.

Loss of Social Status

The loss of jobs and income has capacity to exacerbate people’s feeling of self worth. This is where most people’s thresholds tilt and snap. Mental health history is filled with a litany of tragedies that happened because people could not cope with the sense of being seen as incapable of providing for their family, and meeting societal expectations. Why is this an issue? Their inability to cope is hazardous to their mental health and disastrous to their families and dependents.

Truncated or Failed Obligations

Our sense of self worth is tied to what problems we are able to solve. Many people are owing banks, friends and various lenders for mortgage and other personal and business needs. Without income or hope of earning any income, there’s no way they would not default in payment of obligations. This could lead to loss of property used to secure such facilities, homes or other collaterals. Such a situation compounds the defaulters’ self worth.

Hopelessness

Already many feel hopeless because they can’t see where help would come from. This is the time to dig into our spiritual bank. This the time to draw metaphysical support. The Christian fate teaches that “many are the afflictions of the righteous….” The Covid-19 and its chain of consequences confirms that the righteous and unrighteous are equal in their experience of the pandemic and its impacts. Relief comes to those who take succour in the conclusion of the matter in which the Bible says: “…but the Lord delivereth him from them all.”

Fear of Success

I owe this one to my friend Omoniyi Akinsiju. According to him some people have a phobia for success. The fear of success can be in terms of feeling unworthy or in the form of guilt for succeeding when everyone else is failing. Both situations require a change of mind set.

Religious / Spiritual Fears

The fact that the Church was shut for so long has added to the dilemma of the mass of the people. Doubts are rising over the claims of healings and supernatural deliverances obtainable in churches. Publication of the boasts pastors who died of Covid-19 related causes after boasting of their invincibility, worsens the fear of the common people. Where would the folks go to for solution?

The Solution is Within

The things we do, the ways we spend our time, the things that occupy our minds say a lot about us.  They define who we are.  They make us an open book that anyone can read.  We need to remember that if we want to be a certain type of person, we must do things that such a person would do and think the kind of thoughts such a person would think.

Troy Headrick in an article “We Are What We Do And What We Think About” in Pointless Overthinking blog

The solution is within us. And everyone needs to help himself. As we saw above, the mental health work force is inadequate for the 264 million current depression cases what more the Covid-19 inspired addition. (The following should not be taken as mental consultation, but an advisory).

Identifying the Problem

1. We need to identify the fear we fear. Identifying it will lead to better understanding
2. Talk about it. There are experts that can lead you through talking about the experience you are passing through. Find out counselors on the career you would like to pursue. Such counselors like Media Career Network run by Lekan Otufodurin may be useful to journalists out of job or those planning to leave. Talking about it will help clarify the issues for you.
3. The next step is to clarify your thoughts. Four key clarifications are likely to emerge:
   • Is this a general problem or personal one?
   • Are their personal inadequacies that impede a solution? What are they? How can they be turned to your advantage?
   • What are the opportunities in the Covid-19 period? Which of them are you suited for?
   • What are your priorities: career or income?
4. Personal SWOT.
   • Your strength
   • Weakness. Speaking Scripture such as Philippians 4:13 “I can do all things through Christ which strengtheneth me,” will be very helpful in these times and always
   • Opportunities in your strength that can lead to which income and career choices.
   • Threats in things you must never do like borrowing to feed when you have not figured out how to generate more income than you spend. And environmental factors that can never allow you to make progress along the desired lines.
5. Decide on an Action Plan and stick to it. Perseverance gets more done than undisciplined skills. One action plan that I started lately but which is providing for me and my family is real estate business, which I practice without leaving other endeavours. Interestingly, you don’t have to be a land owner to sell legitimate land and earn an income. Do you know that it also opens an opportunity for you to travel the world without removing from your earnings?

Free Real Estate Training Available for a limited number of people in any part of Nigeria. Take the step by step effort to register and you’ll be contacted.

Free Real Estate Training with RealtorPro.

Start today don’t wait until all others have had a head start. Be the headstart. Good luck to you.

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Covid-19 May Cause Dangote Refinery Into A Force Majeure

The economic devastation occasioned by Covid-19 may cause Dangote Refinery into issuing a force majeure. This was revealed by Mr. Ngozi Asoya a lead analyst at Certified Estates and a knowledge coach after a meeting of his team of real estate business experts and lawyers.

In a report gleaned by reporters, the refinery is expected to be involved in local and international supply of refined and crude petroleum products export.

ALIKO DANGOTE, President Dangote Group

These businesses are guided by contractual obligations which are strictly implemented on contractual terms and there are penalties for failure to deliver. Any eventualities such as accidents and unexpected circumstances may result in failure to deliver at the date expected. That kind of situation is what activates issue of a force majeure in international business.

Asoya says, Dangote Refinery is expected to issue that to indemnify it from contractual obligations. The result of this force majeure extends to real estate companies and businesses in the Ibeju Lekki area that have been using the refinery as a marketing bait.

Long Wintry Night for Dangote Refinery

According to the Certified Estates experts, they are producing a report for their clients warning that the uncertainties in the fortune of Dangote Refinery may affect their business.

The $8billion refinery was expected to start off with the fertilizer plant rolling next month and the other petrochemical products subsequently. However, the covid-19 pandemic has forced oil prices down to $11 below $22 production prices per barrel.

In Mr. Asoya’s view, that oil prices have been collosal means that a new producer like Dangote Refinery would have no profitable market beyond the local market. This, he opined is because, the international waters are saturated with tankers that can not find buyers. The glut will make it not feasible for new entrants he said.

In that circumstances, a force majeure will be a natural safety net for a company especially one in the oil industry where long term delivery contracts are taken seriously.

He forsees a postponement of the date for the take off the project to the last quarter of 2020.

Unviable Sales Appeal

A selling point for real estate in Ibeju Lekki axis was to market it as being close to the refinery. The use of the refinery as a business bait is a faded tactic after the covid -19 pandemic. Responding to questions, he said: “Customers are likely to be asking questions concerning the viability of the brand after the pandemic.” According to him, buyers of land solely on the refinery may have worries but there are still other viable and attenuating business propositions that make the area a good prospect.

He advised buyers to be verify their reasons with honest realtors, noting: “it’s an unviable proposition at the moment to market properties with that project because there’s a long wintry night ahead.”

Why It’s Difficult for Dangote

The refinery is coming at a time considered the tail of the fossil fuel era. Millions of vehicles are already on the streets that use alternative energy resources. There are estimates the fossil fuel will cease to be the energy resource of the 2040’s. It was estimated that given the diversification of energy sources for heating, transportation and light energy uses, investing in refining was not a very smart option.

Some analysts had also argued that the refinery was a mistake given increasing green energy research successes. Asoya disagreed. He is of the view that twenty years was a long time to recoup this investment. According to him, given the projection of the time of commencement, it was not unlikely that the project was viable. However, he said it’s a different ball game with the collapse of the world economy as it is known.

He cited the $11 per barrel of crude as a very difficult position to be for a new entrant. Apart from not being profitable, there are no takers due to a lockdown in most parts of the world. “Buyers themselves, if Dangote has got many, may even be the ones to declare a force majeure as they are also unable to meet their contractual obligations.”

It is a situation of double jeopardy, he said but insisted that the African market alone post covid-19 would require a lot of stimulus boosting. He said manufacturing would be revved up and transportation would most likely roar instantly to live. The African market will be an attractive proposition for the refinery post-covid19, he said, adding, “what should concern everyone for now is how long the cold wintry night ahead would last.”

Effect of Covid-19 on Oil Business

1. The Covid-19 pandemic has shattered oil demand and there’s an oversupply of the product in the market due to the lack of manufacturing and transportation occasioned by covid-19 induced lockdowns all over the world. This double whammy according to a PriceWaterCooper (PWC) source “Refining has often offset oil price declines in the crude markets, with margins and volumes typically growing as crude prices have fallen. But this time is different,” he said. According to him, “Today, while crude oil prices are falling due to oversupply, there is also a rapid decline in demand — both domestically and internationally”

2. It has sunk prices. Between January and April 2020, prices moved from a peak $64.58 on 5 January to a low $11 as at 22 April. This aggressive fall was accentuated by the bickering between Saudi Arabia and Russia over oil supply to the market. Now there’s a glut and prices have collapsed. How soon the excess crude on the high sea will be taken remains to be seen. Despite appeals from the oil cartel, OPEC, the feuding went on for too long.

3. It is posing a major risk for those involved in oil extraction and processing. Being a high professional economic venture, oil business attracts international expertise. For countries that had high incidents of the Covid19 disease, it will be hard to get needed staffing with the requisite experience to return immediately to work. There’s also the fear of another wave of infections.

4. It is hampering new investments in this sector. Already there are estimates that up to $30billion cuts in investment may be activated by the collapse of the world oil industry.

5. Chinese economic recovery will affect global price restoration. Latest studies on oil volatility shows that China has been responsible for over 70% of international oil purchased in 2018-19. Thus it is crucial that Chinese economy should recover speedily for there to be price restoration. Unfortunately, even China makes a quick recovery from Covid19 pandemic, there are still concerns ability the global consumer confidence, and purchasing power.

Whereas internally it might be a tactical action to print currency to bout the economy, it might be a different ball game internationally. So the scenario is a bit unclear, analysts spoken fear.

In February this year before the all out war against Covid19, global oil demand contracted by over 450,000 barrels per day according to International Energy Agency (IEA). By March it had worsened to 1.1m per day contraction.

6. Unemployment crises may settle in if the economic tension continues. Fresh oil prospecting may be hampered as companies may be constrained to reduce their exposure to further uncertainty. A speedy rally of prices may help but there are not enough industry history to make extrapolation on.

Listen to the Executive Chairman of the African Energy Chamber and Petroleum industry lobbyist, N.J Ayuk said: “Thousands of Africans and expats are going to be laid off in oil-producing countries as companies shut down their drilling rigs and planned projects.”

7. African Energy Chamber in their own analysis said Nigeria is bound to suffer revenue losses as a result of Covid19. It opined that since most African oil producers had a budget estimate of $50, there will be “immediate pressure on state budgets and macro-economic stability. Apart from South Africa, the continent’s biggest economies rely heavily on oil revenue to fuel state budget and public spending and ensure macro-economic stability.” According to the industry watchers, of covid-19 as it’s economy is over 75% reliant on oil. They say that COVID-19 would cause the country to suffer the biggest loss of $15.4bn in the continent which represents a 4% shrinking of the country’s GDP.

Before the Pandemic, Nigeria was already in the borrower’s market shopping for funds to fund its budgeted deficit. Unless there is massive re-engineering, the budget is dead on arrival.

Other African oil producers that may be affected include Congo-Brazzaville which experience losses of up to 34% of its GPD because her debt-to-GDP ratio is already already very high at 90%; Angola, may have a revenue loss of about $13bn, representing 13% of GDP; while Equatorial Guinea, Gabon and Chad could see losses of almost 10% of GDP due to the ongoing pandemic.

Options to Market Real Estate in Ibeju Lekki

Property sellers will have to look beyond Dangote for validation. There’s uncertainty about whether the refinery is a good idea right now. The options open to marketers will include the prospect of a new Dubai city, new airport and the deep sea port which all combined still hold a lot of hope for increased economic activity in the region.

The acceleration of work on the fourth mainland bridge also means that the political will to transform Ibeju Lekki into an economic hub is still alive. That should fire enough

Covid-19: Real Estate in Real Trouble

By Ngozi Asoya (Larryhappiday)

Pretty every sector except medical and logistics are beaten impassive and deadpan by the implacable hands of a ferocious foe, Covid-19. The real estate business is not exempted, but hold it for a second.

Real estate refers to a lot of business activities. They include land purchase, land banking, home construction services, building, property marketing, agency, wholesale trading, financing, building materials manufacturing, distribution and interior decoration. The whole chain of activities which begins with land acquistion to building, marketing, renting of property and management of built up properties can conveniently enter into the omnibus called real estate. It is as vast as the widest ocean. I will take you through these to show how each segment is going to be impacted by the covid-19.

Post Covid-19 Economy

Before then let’s look at the post covid-19 business environment.
After the entire stumping by the unconscionable feet of covid-19, the following scenarios would likely prevail for another two (2) years. Unemployment would abound. Many would lose their jobs and the employment landscape would never be the same again. New jobs would emerge to cater to the post covid-19 needs, but many current workers will return to pick their termination letters.

Secondly, office work life style would change. Millions would have found that they don’t have to be on the streets to achieve productivity. In deed it would be most likely that many companies may begin to opt to work from home. Outsourcing would thrive. Collectives that can pool abilities would win contracts to service diverse customers from their homes or garages. Office spaces would be hawked one for a kobo and commercial properties would fall in value.

Thirdly, more investments would be made in technology. 5G would be in hot demand because of its promise to deliver incredible qualitative and quantitative data resources. So would other technology systems evolve to keep pace with 5G. Apps would flood the landscape delivering hitherto unbelievable facilitations.

Fourthly, many staff would no longer be needed. Technology will take over and outsourcing would deliver others. There are so many scenerios that talking about that here would take us away from the topic of today. So another article would be developed to attend to that need. Now over to real estate.

We have already shown the broad spectrum of activities that constitute real estate. Which of them will come out unscathed? Which ones would be worse hit?

Perhaps the only sector that would not be heavily impacted by the despoilation would be land acquisition. The sector would also be the first to rebound. I will explain this point in more details shortly. So please be patient. What about the other sectors?

I am afraid some would resemble a vulcano ravaged sector while others would look like they were hosts to Hurricane Terrible. Let’s look at the rental business to start with.

Rental business is an ancillary to business. Many businesses would be unable to return as they were before the pandemic. In a way, the pandemic has redrawn corporate life. Those businesses with enough finances in the bank may discover that they do not have access to their full range of savings because banks will be unable to meet their obligations. Even if governments intervened, they won’t be able access those government backed reliefs on time. It will come too little too late.

As shown in our previous article, mortgage business will be negatively impacted. Mortgage servicing agencies with precarious financial thinlines before the pandemic would be walking thinner lines afterwards. How many of them will survive would be a subject of financial wizardry. So the mortgage finance sector would default. Customers who had hoped to own homes through mortgages would regret that decision as the some of the institutions may not be in business. Infact the spiral effect of the collapse of mortgage business will depend on how much toxicity there is in the economy but especially in the subsector as well as the ability of the financial sector to withstand the shock of the pandemic. The only exceptions may be those who have their liabilities insured.

Construction jobs are on lockdown. According to an agent in the USA, “The U.S. housing industry is on lockdown. New construction sales centers are empty. In most states real estate agents can’t show houses. Inspectors won’t inspect. Appraisers can’t appraise. Even cash buyers willing to waive contingencies can’t get an appointment.”

Rentals would tumble and be renegotiated. From halls, event venues, hotels to short let facilities, such provided by AirBnB, there would be a long hot summer. Corporate property lease will witness so much toxicity as never seen before. While companies are struggling to get back on their feet, renewal of rentals would suffer setbacks. Default rates could be as high as 40% and landlords would be torn between having unoccupied spaces and unpaying tenants.

Reporting on the current situation half way into the pandemic The Express said: “Thousands of businesses were forced to shut to help protect public health, and as a result, many Britons then lost their jobs.” The result was that “this has had a knock on effect to the housing market as many tenants can no longer afford their rent.”

Speaking in the same vein, Ruth Obih-Obuah of 3Invest says: “The office sector will experience short time disruption as more people work from home. Physical office use rates will fall as remote working increases, and landlords with exposure to short-term leases will be the worst hit.”

Another effect of the pandemic on housing is noticed in the number of homeless persons losing their accommodation because of failure to pay when due and because of prejudice. As that were not enough, poor housing is a recipe for unending recursiveness of infectious diseases. The more homeless there are, the more likely the corona virus is likely to hover. The longer that happens, the more the war against the disease will stretch. Sources have shown that the earliest a vaccine is likely is 18 months from now. Attaining universal vaccination will take even longer.

Tenancy that survives the pandemic will witness reduction of value and loss of confidence. How?
People coming from countries with high incidents of covid-19 will experience discrimination against them stemming from the after effect of the disease. There will be reluctance to take tenants from those endemic regions. This distrust some experts project may last up to two (2) years post covid-19. So there will be general lull in hotel occupancy rates and safe, secure and comfortable shortlet accommodations would be harder to secure. Already AirBnB has seen cancellations running into tens of millions of dollars. Owners of rental properties would have to ensure a long dry spell. Besides, post covid-19, businesses would be more inward looking for cost and renewal purposes.

Land Purchase & Banking Will Fare Differently
Whereas most real estate businesses with tank southwards, land purchase and banking will drive in a different direction. How?
1. Many lessors would have discovered how much they wasted on renting properties without owning their own. Land acquisition for private and corporate purposes will spike almost immediately after covid-19.
2. There will a desire to become landlords providing accommodation, first, to self and then for rent. Those who had purchased their lands with a little patience will see interests growing in as much as three (3) months after the pandemic.
3. Land is the only sector that does not have wasting assets. Homes depreciate and require constant refurbishment; mortgages require servicing; and rentals have wasting assets and consumables that  depreciate. Lands do not have this characteristic so there will not be the pressure to keep them serviceable. In addition, the longer land stays, the more value it acquires without any additional maintenance spending. Thus, lands may stay longer but not become liabilities. The only drawback for now is on inspections. If land sellers can get visual technology facilities that can show live inspections, they may be able to overcome this obstacle.

Consumer Confidence

In the long run, real estate business will witness a mixed grill of fortunes. Consumer confidence is what will determine how fast the sector recovers. Unsold stocks in factories will determine how soon building materials manufacturers will return to full activation mode. That will be determined by the return of consumer confidence and on the non-return of covid-19. That scepticism will last nearly half a year.

It is recommended that you discuss these realities with your realtor. Discerning buyers can get trusted realtors to give them on the spot analysis of the situation as it pertains to different areas. Wholesale buyers with enough financial power may be in for a swell time though. They will be able to buy cheap as interest rates tank and owners get desperate to sell which will bring prices towards their advantage.