Effects of COVID-19 on the Real Estate Business in Kenya
COVID-19 has affected the real-estate business in a major way, but the sector still fights on trying to adjust. Many people might be wondering if it is a good idea to invest in the property business at such a time.
How COVID-19 has affected the Real Estate Business
Closing of some major businesses in the hospitality and commercial sector
Ever since the lockdown was announced on March 15th this year, many businesses have shut down while others have sent their employees home to cushion their enterprises from losses. In this event, the hospitality and commercial sectors of the real estate business have suffered a blow. The hospitality industry suffered majorly because it’s largely dependent on foreign tourists.
With many people being forced to work at home, offices have become something people can do without. Many commercial buildings and retail shops have been vacated. Even as the Hospitality industry struggles to get back on its feet, the commercial (offices, industries and retail shops) industry will have to find ways to adjust and keep up with the trends in the market. For instance, we are going to witness a high demand for warehouses as more businesses embrace buying and selling goods online.
The halt of some projects
With the social distancing directive in place, some investors have had to reduce the number of workers on their sites, and this increases the completion time. Some investors have had to stop their on-going projects altogether as they wait for the economy to recover. Others are even selling their incomplete housing projects.
Slow-paced access to government services
With the strict guidelines of the pandemic, accessing necessary documents from the government offices has been a slow and frustrating endeavour. Some offices are closed whenever a worker contracts the virus, and other rules keep coming up. Investors especially the new ones in the business may probably use this as an excuse not to venture into the business at this moment.
All the above factors coupled with the economic decline have led to reduced markets for the real estate business. Many people have lost their jobs abruptly, and some of them were yet to finish paying their mortgages.
Why this can be the best time to Invest in Real Estate
The results of Covid-19 in the economy and the real estate sector will discourage many people from even considering to invest in this industry. Somehow, life has to move on and it will move on even if the virus will not end soon. People will still need a roof over their heads. After the pandemic, many people will be motivated to own homes. Such a disruption may present itself again and people will want to be prepared.
Right now there’s lots of property to choose from since many people are still second-guessing and trying to observe the situation before they decide to invest or not. At this time also, there are great discounts for property and payment plan solutions.
The rise in demand for houses and rentals will be experienced when the pandemic is over and the economy has picked up. So, it won’t be a bad idea to own land and build rentals and even buy your own home.
You can only do this if you have the resources, and have a good understanding of the type of property you want to invest in. If you are willing to take the risk, make sure you go with the trends.