Alphacrux CEO: How COVID-19 is impacting real estate agency business in Lagos

The COVID-19 pandemic has disrupted industries worldwide, and the real estate sector is no exception. Alphacrux, a leading real estate company, conducted a survey to assess the impact of the pandemic on the residential real estate market in Lagos. CEO Toby Adama shared valuable insights in an exclusive interview with CNBC Africa. As the discussion unfolded, Adama shed light on the challenges faced by the real estate agency business in Lagos and the evolving dynamics in the market. The pandemic brought about a significant downturn in real estate activities, with physical inspections and transactions coming to a halt during the lockdown period. Adama highlighted that the inability to conduct in-person visits adversely affected the industry, leading to a decline in business for many practitioners. According to the survey conducted by Alphacrux, a notable 89% of respondents reported a negative impact on their business due to COVID-19. Furthermore, Adama explored the impact on tenants, noting that the uncertainty surrounding income and financial stability has influenced their decision-making. With many individuals experiencing job losses or income reductions, the dilemma of prioritizing rent payments has become prevalent. Tenants are considering various payment options, including monthly, biannually, or seeking rent moratoriums from understanding landlords. This shift in payment structures reflects the adaptability of both tenants and landlords to navigate the challenges posed by the pandemic. When discussing the broader market situation, Adama emphasized the potential role of the mortgage industry in stimulating real estate ownership and growth. The survey revealed that 94% of respondents believed that a well-developed mortgage system in Nigeria could encourage more people to invest in homeownership, thereby boosting the real estate market. However, Adama acknowledged the existing challenges in obtaining mortgages in Nigeria, citing high interest rates and property prices as significant obstacles. The stringent mortgage criteria and financial barriers pose difficulties for aspiring homeowners, hindering their ability to enter the property market. As the real estate landscape continues to adapt to the new normal brought about by the pandemic, industry players like Alphacrux are exploring innovative strategies to navigate the challenges. Adama's insights underscore the resilience of the real estate sector in Lagos, highlighting the importance of flexibility and collaboration between landlords and tenants during these unprecedented times. While the road to recovery may present hurdles, the industry's ability to evolve and adapt will be crucial in shaping its future trajectory.