AA - May 2020

Author:  property 24
4 May 2020

 Alert Level 4 Rules / How it affects Estate Agents and the Real Estate industry 

While the deeds office will be open as an essential service there will be no show houses permitted during Alert Level 4 when South Africa’s lockdown moves to Alert Level 4 tomorrow, on 1 May. The latest Regulations relating to the Schedule of Services and Framework of Sectors was gazetted and released on Thursday night, 29 April.

They repeal all previous Regulations issued in terms of the COVID-19 pandemic dealing with the forced lockdown in South Africa. The new Regulations speak only to Alert Level 4 from 01 May 2020. 

But it’s not as clear cut as all of South Africa moving to Alert Level 4.

“Government will be adopting a ‘risk-based’ approach with more severely affected areas set to face stricter regulations than areas that don’t have as many coronavirus cases. To ensure that the response to the pandemic can be as precise and targeted as possible, there will be a national level and separate levels for each province, district and metro in the country. As a result, legal advice will differ in each case depending on the severity of the lockdown level in an area,” says Michelle Dickens, MD of TPN Credit Bureau.

Under the new rules the deeds office will operate, evictions will be allowed under certain conditions – but no moving to new places of residence will be allowed during this alert level. 

SEE: Can I move? Alert Level 4 rules for tenants and landlords 

“Property Practitioners including sales agents are not listed as essential services as defined in the regulations and therefore would be able to work from home if they can offer virtual viewings with pre-recorded video footage of a property. They are not permitted to perform other functions such as physical property viewings, show houses or any work that would require them to leave their primary residence,” advises Dickens. 

“The Cabinet will determine the severity of the Alert Levels 1-4 and the extent that they apply to each area. These answers have been prepared under Alert Level 4 and should be utilised only under this instance.

Key changes from Lockdown to Alert Level 4 for the property industry:

  • The deeds office is open and will be functioning from 01 May 2020.
  • Sherriff services are to commence for all legal practitioners, thus Court documents, applications, and action can be served.
  • Evictions are allowed! A competent Court may grant an order for eviction. Provided that any order of the eviction shall be stayed and suspended till the last day of Level 4. Unless a Court decides that it is not just and equitable to stay and suspend the order until the last day of the alert level.
  • Permits for the movement of persons may only be issued under very restricted circumstances. These circumstances include:
    • Permits to perform essential work or a permitted service signed by the institution.
    • Permits for the movement of children to travel to another province of metropolitan area or district.
    • Permits to travel to another province or metropolitan area or district for a funeral.

Questions 1: Can a new home-owner move to, or vacate property during Alert Level 4?

No. We can derive this from provision 16 of the Regulations. The Regulations specifically state:

16(1)

Every person is confined to his or her place of residence

16(2)

A person may only leave their place of residence to:

 

a.

Perform an essential or permitted service, as allowed in Alert Level 4.

 

b.

Go to work where a permit has been issued.

 

c.

Buy permitted goods.

 

d.

Obtain allowed services.

 

e.

Move children, as allowed.

 

f.

Walk run or cycle between the hours of 06h00 and 09h00 within 5 kilometres of their place of residence.

Therefore, moving into or out of properties is not allowed. Effective communication between the buyer and seller is vital during this time, please do not take the Law into your own hands or be the test case for vacating or moving into a premises.

SEE: Virtual property transactions | The new normal in real estate

Questions 2: Can people who have bought a new house use the once-off movement to move into their new home?

Only persons returning to their residence or work, who was not at their place of residence or work during lockdown, will be able to travel between provinces and metropolitan areas. This is a once-off movement to return to their own residence, not to take occupation of a new property. During the panel discussion with the media, it was hinted that this would need to occur over the 1st of May long weekend and that it is not intended to circumvent the Regulations.

Question 3: May an estate agency trade from their place of business and perform all estate agent functions?

No. An estate agency is not listed under Table 1 of Alert Level 4 for essential work or permitted services. In the previous draft regulations, commercial and residential real estate activity would only be allowed at level 3 and level 2 respectively. Estate agents, property managers, property practitioners or landlords are not permitted to travel to, do or conduct any activity in the ordinary course of business.  

But there are a number of things that sales agents can still do, like take listings, take on new mandates, sign Offer to Purchase agreements electronically and facilitate bond applications. There absolutely are OTPs being signed at the moment, most of them with conditions included that the sale is subject to a viewing of the property post lockdown.

“This is also a great opportunity to catch up on admin and do research! Understand your market better, even if you have been in the area for a long time, you can download the TPN Property Reports to catch up on the very latest stats,” advises Dickens. 

PODCAST | Why Spatial Transformation matters now more than ever in South Africa

‘Effective communication is key’

Dickens says, “This is an unprecedented situation for the residential and commercial real estate industry, not only in South Africa but globally. Clarity, further proposed amendments to the Regulations and challenges to the existing framework is ongoing and paramount. We will continue to speculate, assume and contrast the Law in relation to morality and Ubuntu until specificity is garnered from the Regulations.

“Until then, effective communication is the key. Landlords, estate agents and tenants must communicate – we will all get through this, but only together.” 

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