Integrated Properties managing consultant, Mike Juru (pictured), said the real estate sector has witnessed slightly positive movements in terms of property purchases as mortgages are more readily available on the market.
“There is limited commercial sector activity, but on individual basis, the opening of mortgage-related transactions makes property development a reality,” said Juru.
Zimbabwe’s property and construction sector had trudged for a decade marred by political uncertainty and limited investment, with little or no activity, as recapitalisation constraints hampered company abilities to carry out infrastructure development-related projects.
However, the sector has witnessed a surge in construction-related activity. The banking sector and micro-finance institutions have of late, been issuing out personal loans as competition for a wide client base steps up.
The company’s director, Overson Chiyaka, however said, the economic growth prevailing in the country is yet to translate into property sector growth on a large scale.
“We have noted that developers are waiting for a conducive environment for them to move on with the business,” said Chiyaka. “Property is basically a long-term investment and there is the need for a guarantee through an enabling environment”.
He said the major constraint with regard to mortgages, was the tenure and punitive interest rates. “For instance, whereas in the past, mortgages ran up to 25 years, we now have a situation where mainly 10-year mortgages can be accessed at interest rates as high as 18% per annum,” he said.
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Chiyaka said there was need for cheaper finance with longer tenure as the current interest rates are not sustainable.
