Chronicle Editor
Business Reporter
ZIMBABWE’S property market has demonstrated remarkable resilience, navigating through a period of exchange rate-driven volatility and the impact of certain policy tweaks.
The domestic economy has largely stabilised since the introduction of the precious metals and foreign currency reserves-backed currency, Zimbabwe Gold, in April this year, which stabilised the exchange rate and inflation.
In the 2024 Mid Term Budget Review, Treasury announced several measures to promote the wider use of the domestic currency, and these include payment of presumptive tax in local currency.
Similarly, large-scale businesses that generate more than 50 percent of their revenue in hard currency are now required to settle their tax obligations on a 50-50 split between ZiG and forex.
The property sector continues to attract significant interest, driven by the prevalent use of the US dollar in transactions, stockbroking firm Akribos says.
This has bolstered confidence among banks and private developers, priming the market for income-generating properties such as residential and commercial real estate.
Akribos Securities said in its latest report that the dominance of hard currency-denominated sales and rentals has been a crucial factor in sustaining the property market’s growth.
“The property market in Zimbabwe has remained resilient, albeit experiencing some fluctuations due to the prevailing economic challenges and policy changes.
“For income-generating properties, such as residential or commercial real estate, growth has continued to be supported by the widespread use of the US dollar.
“This steady growth is particularly evident in sectors such as storage, warehouses, retail, and transport hubs. Engineer Chipo Murereswa noted that the widespread use of the multi-currency has indeed been a game-changer, providing stability and confidence for both banking institutions and private developers.
“This has revitalised interest in income generating properties, particularly in the residential and commercial sectors.
“I see significant potential in the continued development of storage, warehouses, and transport hubs, which are essential for supporting our growing urban centres,” she said.
However, demand for office space in central business districts remains relatively low and the divergence in demand underscores a shift in commercial property preferences, as businesses adapt to the evolving economic landscape and prioritise functional spaces that cater to logistical and retail needs.
Economist Tinevimbo Shava said the recent report underscored a key dynamic in Zimbabwe’s economy which is the critical role of multi-currency in stabilising and fostering growth in the property market.
“The dominance of US dollar transactions has attracted substantial investment, mitigating some of the economic volatility (earlier in 2023). This has been crucial for sectors like retail and industrial properties, which are experiencing steady growth,” he added.
“Moving forward, maintaining this momentum will require consistent economic policies and further support for the use of stable currencies to ensure sustained investor confidence and market expansion.
“According to the report, urbanisation is a significant driver of this increased demand in the property sector and as more people migrate from rural areas to major cities like Harare and Bulawayo, the need for housing, commercial spaces, and industrial facilities intensifies.
Akribos Securities highlighted this; “The ongoing urbanisation and growing population migration from rural areas to the country’s major cities, such as Harare and Bulawayo, is creating more demand for housing, commercial spaces, and industrial facilities, particularly inthese urban centres.
“This urbanisation trend presents a lucrative opportunity forinvestors who are keen to capitalise on the burgeoning demand for real estatedevelopment.
The influx of people into urban areas is expected to drive upproperty prices and rental rates, offering potentially higher returns forinvestors.
“Investors are recognisingthe potential to capitalise on this urbanisation trend and the resulting needfor real estate development and expansion.
This surge in demand is likely todrive up property prices and rental rates, potentially leading to higherreturns for property investors,” Akribos added.
While the property market in Zimbabwe faces itsshare of challenges, experts say the wide use of the US dollar, combined with growing urbanisation and strategic investments, is fostering a robust and dynamic sector.
The outlook remains positive as the market continues to adapt and thrive amid economic uncertainties.
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