Clara Mawere Business Reporter
THE African Centre for Real Estate and Land Economics is compiling Zimbabwe’s first property data bank and price index to provide information on the proper pricing of property investments in the country. Speaking on the sidelines of a seminar held by ACRELE last week, ACRELE’s head of business development Mr Munyaradzi Nyamagodo said the major problem that is affecting property investment is the lack of a data bank.
“ACRELE is in the process of compiling Zimbabwe’s first property data bank and price index which will benchmark with South Africa, the US and most countries in Africa.
“Zimbabwe does not have a property price index for corporate analysis. There is need to have a well-structured process of attracting Foreign Direct Investment in the country’s real estate and infrastructure sector involving players in the real estate sector,” he said.
Mr Nyamagodo added that there is only one company that does property research but it still needs to be equipped further and this can only be done through capacity building with multi-lateral institutions to support and improve the capacities of such companies.
Property analyst Mr Mennard Chekayi said there is an information gap in real estate investment though the rental market has been stabilising since the multi-currency era begun four years ago.
The property market is falling and the construction sector has not seen much activity.
“The rental market has seen rentals stabilising since dollarisation because of the stable operating environment and it has relatively low yields compared to the region (about 18 percent discount).
“The construction sector has not seen much activity because in the residential sector private residential developments are dominant, industrials are mainly redesigning to warehousing,” he said.
The scale on the commercial market is still proportionally lower with institutional investors announcing small scale developments.
Mr Chekayi added that construction cost to value ratio is relatively high and it is still cheaper to buy than build and agents are no longer chasing new space but refurbishing the properties they already have.
“Retail estate experienced a boom and it is still amongst the most attractive especially for commercial agents, residential is lucrative to an upturn, industrial is still in a slump, demand is falling and rentals are falling also,” he said.