adminchose to invest in this period aimed at advancing their portfolios premised on the generally regarded forecast of a more stable and viable Zimbabwe post the election period.
There are expectations that if such forecasts come to pass investors may significantly benefit from an increase in values on both properties for rentals and sales making property investment a massive opportunity for good short to medium term investment to be exploited during the coming years when the economy will be booming.
The year began with overwhelming “Yes” vote in a referendum upon the presentation of our nation’s draft constitution which has subsequently become our new constitution.
The new Constitution under Section 71 and Section 72 separates property rights from agricultural land rights and more clarity on this issue for the investor.
Under property rights, “property” means property of any description including any right or interest in property. It goes further to state that every person in Zimbabwe has the right to acquire, hold, occupy, use, hypothecate, lease or dispose of all forms of property.
Agricultural land according to Section 72 refers to land suitable for agriculture. It does not include communal land or land within the boundaries of an urban local authority or within a township established under a law relating to town and country planning or in a law relating to land survey.
If such agricultural land is required for resettlement of indigenous persons or some other public purpose, the state may compulsorily acquire by notice published in the Gazette identifying the land, right or interest, whereupon the land right or interest will henceforth vest in the State from the date of publication of the notice. This adoption in the new Constitution one hopes has brought finality to the land question.
The adoption of the new Constitution though a milestone in itself and capable of showing certainty on Zimbabwe’s way forward including on property investments, failed to motivate activity in the property sector.
The upper property market suffered the most as transaction in bigger and more expensive properties stalled because of a lack of big investors who are holding out to see the election outcome.
The middle market and lower markets started the year with little movements of properties, however towards the fourth month of the year slight movements where witnessed resulting from employers offering company backed mortgages and some banks offering general mortgages to some members of the public.
However, this mainly benefited the middle-income housing areas that have more properties with title deeds than the high-density areas that have fewer properties with title deeds.
This resulted in an increase for demand for stands and properties that do not cost more than US$50 000.
Most investments in this category were made by first time buyers or seasoned investors in Zimbabwe who through experience do not pay too much regard to political bickering when it comes to property investment.
Another positive for the property sector was the May 30 announcement by the Harare City Council that it is incorporating 10 new suburbs into the central business district which include Arcadia, Braeside, Hillside, Ridgeview, Milton Park, Newlands, Eastlea, parts of Belvedere and Graniteside following an unprecedented surge in rental demand for these areas.
The announcement came as the areas had already been unofficially incorporated into the CBD through practice and demand by investors.
To achieve this expansion the city is reviewing the CBD local development plan 22. This will involve a mix in land use implying that offices, residential, schools and other services will co-exist. The aim of the expansion is to decongest the city centre. The city will review the rates payable in these areas so that they are aligned with the new status of commercial use.
A revised Housing Policy was also launched by President Mugabe this week. Government through the policy is aiming to develop self-contained human settlements with housing, commercial and industrial facilities at the periphery of major urban centres as a means of decongesting city centres.
While launching the policy President Mugabe called for new technologies in housing construction that are consistent with issues of climate change.
He emphasised that new developments must incorporate basic social amenities like schools and clinics.
The policy includes a clause that bars the eviction of people from informal settlements without securing an alternative for them, promotion of suitable rural housing, urban renewal programmes and various housing finance programmes.
Though the property market has experienced a slow start in the year, one anticipates a more active market in the second half.
Vengai Madzima is a property investment consultant and analyst and writes in personal capacity. He can be contacted on 0772 468093 or email: [email protected]
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