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New mortgage advances have mainly been directed towards new housing units in line with the national objective to increase the country’s housing stock

Kudzanai Sharara
Zimbabwe’s leading housing financiers provided mortgages worth $45 million during the first half of 2017 with the bulk of the advances financing new units, the Zimbabwe Association for Housing Finance (ZAHF) has said.

Responding to emailed questions by The Herald Property Guide, ZAHF said new mortgage advances have mainly been directed towards new housing units in line with the national objective to increase the country’s housing stock. The current national estimate of housing requirements stands at 1,25 million housing units, and growing.

“Of the total $45 million advanced during the first half of 2017, $36 million financed 1,297 new units, mainly in the high density sector. The balance of $9 million was advanced towards acquisition and enhancement of existing properties,” ZAHF said.

ZAHF said its members have since advanced more mortgages in the first six months of the year than it advanced in the full year of 2016. As a result, the value of the mortgages also increased.

“The number of borrowers for the first six months of the year went up by 23,22 percent to 10 697 from 8 681 the whole of December 2016.Total mortgage capital of the Association’s members stood at $448 million compared to $415 million loaned as at 31 December 2016,” ZAHF said.

ZAHF said demand for housing is mainly concentrated in the low income end of the market where illegal settlements have mushroomed posing a challenge of unhealthy habitats.

“Demand also exists in the medium and low density areas where financial institutions and property developers are acquiring land, servicing it and establishing new elite residential areas comprising townhouses and stand-alone houses.

ZAHF, which is chaired by Mehluli Mpofu of the Central Africa Building Society (CABS) has ten members including CBZ, CABS, FBC and ZB, NBS, Metbank, BancABC, NMB Bank, MBCA Bank and the People’s Own Savings Bank (POSB). The housing finance business in past years was the preserve of four Building Societies namely CBZ, CABS, FBC and ZB who constituted the Association of Building Societies.

Following changes in legislation which opened the mortgage lending arena to other financial institutions in recent years, the Association welcomed new members in the form of Metbank, BancABC, NMB Bank, MBCA Bank and the People’s Own Savings Bank (POSB) who have added housing finance to their range of financial services.

In May 2016 the Association welcomed the National Building Society (NBS) bringing the Associations membership to ten. It was considered necessary to change the name of the industry body from the Association of Building Societies to the Zimbabwe Association for Housing Finance (ZAHF) which encompasses the Association’s broadening membership and aligns with the continental body — the Africa Union for Housing Finance (AUHF).

Eight members of the Association have been lending actively. The POSB launched its mortgage lending unit on the 23rd August 2017 and has commenced processing applications while Metbank are in the process of setting up their lending outfit. Mr Felix Gwandekwande of FBC Building Society chaired the Association over the past two years and handed over to Mr Mehluli Mpofu of the Central Africa Building Society (CABS) at the Association’s Annual General Meeting held on the 19th July 2017.

Mrs Emmah Mungoni of the ZB Building Society is the current Deputy Chairperson while Mr Ambrose Matika is the Executive Secretary.