The coronavirus pandemic continues to dominate the news. New record numbers of infections are being reported worldwide every day. Germany was hit particularly hard by the spread of the virus in the second quarter of 2020, and the Federal Government responded with extensive contact restrictions. What impact did these have on the letting business of the German housing industry? We reveal the figures from the first two quarters of the year and draw a comparison.
Although our customers were able to let flats almost contact-free thanks to Immomio tenant matching and the digital tenancy agreement, we responded quickly to the coronavirus crisis and developed a live video viewing tour. After the letting business had come to a near standstill, landlords using Immomio’s digital letting process were thus quickly able to regain a degree of normality. Nevertheless, a look at the figures reveals just how great an impact COVID-19 has on the letting business.
>> Digital flat viewings and how we support our landlords in the crisis.
Supply shrinks – demand remains almost stable
In the second quarter of this year, our customers published 19 per cent fewer flats on the property portals than in the previous months. This is primarily because there were generally fewer tenancy terminations during this period. Over the same period, however, the number of applications fell by only 6 per cent. Applications per published flat therefore increased. The gap between flats on offer and flat seekers was thus considerably larger in the second quarter than before. As a result, it was even harder for prospective tenants to get a flat while contact restrictions were in place.
Fewer flat viewings
In line with the falling supply, considerably fewer prospective tenants were invited to viewings in the second quarter. Our platform recorded a 38 per cent decrease compared with the previous quarter. The number of viewings created via Immomio also fell, but far less sharply: by 10 per cent. Overall, therefore, considerably fewer participants than usual were invited to flat viewings, and more individual viewings took place. Our tenant matching for pre-qualifying prospective tenants thus became more important.
Prospective tenant database on the rise
There was a veritable boom in the use of the Immomio prospective tenant database. This is a database of thousands of prospective tenants who are actively searching. Immomio customers can make a digital flat offer to suitable prospective tenants with a single click via the Immomio platform. Compared with the first quarter of the year, 60 per cent more flat offers were sent via the prospective tenant database in April, May and June. During the coronavirus crisis, quality over quantity matters even more than usual for landlords. That is why they prefer to offer flats to selected prospective tenants whose tenant profile fits the residential structure of the building rather than publishing them on portals. The concept of the prospective tenant database is gaining more and more ground and is proving its worth, especially in times of crisis.
Digitalising letting processes mitigates the impact of COVID-19
As in many other industries, the coronavirus pandemic is making clear in the housing industry what digitalisation is already capable of achieving. Digital letting combined with the prospective tenant database ensures that the impact on the letting business is far less drastic than in other areas.