CABS relaxes Budiriro housing terms
Mortgage lender, Central African Building Society (CABS) has further relaxed terms for purchasing houses at its Budiriro housing project, as uptake remains very low.
In 2013, CABS partnered the Harare City Council in the $15 million project which saw construction of 2 800 houses, but uptake of the units remains low due to the stringent purchase terms, which are out of reach to most low income earners. Initially, home seekers were expected to pay about $5 000 deposit for two-roomed houses that were being sold for $22 000, and $7 000 for the four-roomed houses whose total cost was $27 000. After a while, the deposit requirements were in 2015 reduced to 10 percent from 25 percent of the total house value.
CABS also introduced the rent to buy scheme in an effort to stimulate demand for the houses, but uptake has remained subdued. Hence, the bank has announced further revised terms which include a reduced minimum qualifying salary of $500.
“Mortgage tenor (has been) increased from 20 years to 25 years,” the bank said. A deposit of 10 percent is still required, while the interest rate on the mortgage also remained unchanged at 10 percent per annum. At the inception of the project the interest rate was pegged at 25 percent before being reduced. Access to affordable housing remains a challenge in Zimbabwe.
Poor planning, lack of disposable income and alleged corruption in most local authorities has seen the supply for residential accommodation failing to keep up with an ever growing population. But the Government is making efforts to bridge the housing provision gap through the National Housing Delivery Programme (2014-2018) under which it is targeting to deliver 313 368 housing units or serviced stands. Private developers and housing co-operatives are also complementing government efforts to provide affordable housing. — New Ziana.