|PROPERTY REPORT FOR LAST QUARTER 2011|
PROPERTY REPORT FOR LAST QUARTER 2011
PROPERTY AS AN INVESTMENT
While property in Zimbabwe remains under-valued, prices have been rising by as much as 30 per cent a year. They are being driven by replacement costs that are around $1,000 a square metre: you can purchase a property for about half that figure.
Following a dip in values mid-year, the market has recovered with the repeal of the exchange control regulation RM 80 issued on August 1, 2011, on September 16.
Sales stalled when the Reserve Bank of Zimbabwe issued a directive saying that sellers could send R350,000 of the proceeds from the sale of a property outside the country immediately and the balance in four equal tranches after a year. Given the central bank’s record on confiscating foreign currency, this struck fear into the hearts of property-owners.
Sellers achieve top dollar for well-maintained properties in sought-after areas. According to John Spicer, chairman of Seeff Zimbabwe, many owners refuse to face reality about the cost of the work required to repair or modernize their homes and insist on marketing their property at unrealistic prices.
“Our team of experts are out and about looking for quality homes for both local and overseas buyers,” he said. Many Zimbabweans, while now settled in the Diaspora, want a home of their own in their country of birth as both a reward for hard work and a place for their family to live. In a country with 98 per cent unemployment rent is beyond many people now.
“We pride ourselves on finding the best of what is available and giving buyers and sellers a seamless, professional service that helps both sides achieve what they want,”
Bond or mortgage finance is available but in short supply. Central African Building Society, the largest of the three sources of home-owing finance, offers bonds to existing investors at 15 per cent over 10 years and as available funds increase as the economy stabilizes, the price of property will continue to rise.
Sales worth upwards of R7 million are no longer uncommon for upmarket homes – payment, however, is not always forthcoming which results in the houses coming back onto the market. A firm offer backed by ready finance usually achieves a discount on the price.
Rentals for residential properties in all areas have increased dramatically over the last 18 months due to the severe shortage of well-maintained properties in sought after areas. Monthly rents of R14,000 are now being achieved.
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