PROPERTY – Lack of finance hampers housing development


Staff Writer

LACK of access to finance and the unavailability of meaningful investment in housing development by the private sector have limited the involvement of cooperatives in housin

g projects, the Portfolio Committee on Local Government heard last week.


The Community Action Group on housing last week told the portfolio committee that access to finance was inhibiting the operations of housing cooperatives in the country.


From the time of your report, the economic environment was characterised by rising inflation, high interest rates from borrowing funds and no meaningful investment on housing development in the private sector. These developments have negatively affected the participation of housing cooperatives in housing development projects,” the group said.


The Community Action Group is made up of people working on housing developments for low to ultra-low income urban dwellers.


The membership includes Housing People of Zimbabwe, Civic Forum on Housing, Dialogue on Shelter, Zimbabwe National Association of Housing Cooperatives and Zimbabwe Homeless Peoples Federation.


The group urged government and parliament to look into their concerns.

Community Action Group said in the past access to finance for low-income groups had largely been through donor aid by the United States Agency for International Development (USAid).


The group said funds channelled through building societies had limited impact on the intended beneficiaries.


“Building societies still consider lending to low-income groups as high risk,” the group said.


The group said in cases where mortgages had been considered, the loans were too small to make any impact.


Under the USAid programme, a person earning $30 000, a threshold for accessing such loans, qualifies for a mortgage of not more than $700 000.


However, the cost of building a 28-square metre unit is estimated at $15 million.

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