Saturday, 11 April 2020

Economic effect of COVID-19 killing us more than the pandemic itself — Small business owners

One bright morning in early March, a Lagos-based real estate agent, Mr John Adewale, got a call from a potential client wanting to buy a property worth N15m at Oribanwa in the Ibeju Lekki area of Lagos. The deal was to be finalised by the end of the month and Adewale’s firm was to make at least 

10 per cent of the property value – that is, N1.5m – in commission.
A day after he received the call, another potential client seeking to buy a four-bedroomed terraced duplex in the same area called Adewale. Without hesitation, the real estate agent gave the value of the property as N23m, hoping to make a decent commission of N2.3m. But the buyer postponed the property tour and possible purchase till April.
However, Adewale got disheartening calls from his two potential clients earlier during the week as they informed him of disinterest in the property. “I had been expecting the bad news, though,” he said. “But I was still praying and hoping the deals would go through.”
Unsurprisingly, Adewale’s potential clients attributed their refusal to buy the property again to the coronavirus pandemic and the attendant shutdown of businesses in Nigeria.
“They said their companies could not afford to make big purchases for now as they were not making income due to the lockdown,” Adewale said low-spiritedly as he spoke to our correspondent via the telephone.
Although his potential clients said they might still consider buying the property again when commercial activities resumed, Adewale said he could not depend on such promises again.
“The past few months had been bad before the potential buyers called, and I was hoping my firm could make some money to ease the pain. I had spent a lot on marketing and salaries and I was hoping to recoup expenses with the sales, then I got the bad news. Everything is down now due to the coronavirus pandemic,” he lamented.
Also, the chief executive officer of a real estate company in Ogun State, Mr Kazeem Ganiyu, complained that the lockdown had wreaked havoc on his business.

Clients who had booked property tours before cancelled their appointments, a development which meant that no money would be made until the resumption of commercial activities in the property market.
Ganiyu said, “There is not much money in circulation right now. Though there’s property but clients have put inspections on hold for now. Those who intended to buy property before are now drawing back. They don’t want to spend the money now.
“Even those who wanted to rent houses have suspended house tour and payment. The situation is really affecting us.”
Ganiyu also said some property owners had started putting up their property for sale so they could have some money in case the pandemic and the lockdown continued.
“Yes, some are selling their property in distress. A property worth N20m is now being valued at N12m or less,” he said.
Although Ganiyu said these developments were expected, they were saddening because of their economic effects.
“As it is, it’s bad times for us. We have salaries to pay, but you know it’s when we make profit that we can pay. We are also incurring expenses,” he said.

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