Our monthly newsletter endeavours to give you insights in to changes and trends we are seeing in the market or industry.
Newsletter - September 2021
It has been an interesting few days so I thought I would write about the differences that we are seeing between the “Delta” L4 lockdown and the original Covid lockdown in late March 2020, until early May 2020 as I recall. Last year the virus was so new that no one quite knew how things would pan out – least of all most economists and the Government.
However thanks to the latter’s largesse, most businesses not only survived, but many of them thrived and actually generated profits at a level similar to or more than the previous year. So how are we placed as we suffer (or enjoy) another nationwide L4 lockdown due to the Delta variant? Well the economists are a little more relaxed – see https://www.infometrics.co.nz/lockdown-2-0-delivers-a-setback-to-nz-economy/.
Moreover most Kiwis have seen how well the economy rebounded from the initial lockdown, during the rest of the year – plus:
- Most business balance sheets are stronger now than then
- There is significantly more liquidity within the economy
- Unemployment is very low with fewer migrants to fill the job gaps
- We have a vaccine that is effective and within 3-4 months all Kiwis who want it, will have it
This confidence is reflected in the fact that our brokers have not been able to put our feet up this time around. Just this week we have:
- Buyers wanting to arrange on site (post lockdown) or Zoom meetings with a wide variety of vendors
- Strong demand for IM’s from prospective buyers as they take some time from their “day job” to review listings
- Ex pats who have returned and still want to get into their own business
- New vendors making contact as they have time to remove themselves from the demands of their business to reflect upon “what next”
Moreover most service industries are still working, as we can tell from timely responses from lawyers, accountants and various other professional advisors when we reach out to them. Whilst Delta is a beggar of a virus, most of us (and many overseas countries) are seeing the light at the end of the tunnel – largely due to high take up of the vaccine. This will not protect us 100% - that’s a fact – but it will seriously mitigate the damage to most people who catch the virus, and in theory remove the issue around overwhelming our ICUs nationwide.
Likewise, while Kiwis are not travelling overseas, we are continuing to spend money on ourselves, our families, our homes and our recreational activities. Long may this continue, and please have a look at this month’s opportunities, as there is plenty to appeal for the right buyer!