HomeBusiness DigestRent Board welcome, says REIZ

Rent Board welcome, says REIZ

Ngoni Chanakira

THE president of the Real Estate Institute of Zimbabwe (REIZ), Abraham Sadomba, says the recent decision by the Ministry of Industry and International Trade to revive the Rent Board that moni

tors property sector pricing was welcome and would go a long way in thawing the current tension between government and his members.

Sadomba said the revived Rent Board, which had taken a back seat in the past, would be vital for the association to pave the way forward.

There has been tension between the association and tenants who accuse landlords and estate agents of rampant profiteering.

The accusation was repeated by Reserve Bank of Zimbabwe (RBZ) governor, Gideon Gono, when he presented his monetary policy statement for the second quarter to June 30 2004.

Gono accused the real estate sector of abusing the foreign currency system by charging exorbitant rentals at a time when citizens were facing numerous other escalating rates.

Last month Sadomba had a brush with the Bulawayo-based Affirmative Action Group (AAG) which had told its members not to pay the high rent.

Sadomba, however, said the AAG should concentrate more on lobbying members of parliament and government officials than terrorising REIZ members.

In an interview with businessdigest Sadomba said the AAG was going around Zimbabwe pretending to be lawmakers.

“Who are these people and where do they get their power from?” asked Sadomba. “They should concentrate on putting pressure on the government and members of parliament instead of disrupting commerce and industry which is being run professionally.”

Sadomba said the AAG had tried to intimidate his members without sufficient knowledge of how the increases were arrived at.

“Commerce and industry are very sophisticated and these AAG guys are just political,” he said. “Actually they have no right stopping members from paying their rentals to a legal organisation that is sanctioned by an Act of Parliament. They are breaking the law.”

Sadomba said the AAG should not bring politics into business.

“Where are they getting their mandate from to deal with our members the way they are doing,” he said.

Sadomba said the REIZ represents members countrywide and before any increases are done tenants signed and agreed to the percentages.

He said these were now done on a quarterly basis because of the country’s hyperinflationary environment.

Sadomba said in caseswhere there were disagreements, individuals could seek arbitration.

This week he said the Rent Board would help solve all these issues in a more professional manner.

He said it was more appropriate for quarterly rent increases than the half-yearly increases as recommended by government.

Sadomba said hyperinflation also had to be factored into the equation when such decisions were arrived at.

Bulawayo-based residents have been up in arms over what they allege are willy-nilly rental increases by unscrupulous estate agents.

They engaged the AAG which took the matter into its own hands and turned it political.

The AAG encouraged members to disregard the increased rentals and report any landlords insisting on payments “to them”.

Meanwhile properties for letting, especially garden flats, are becoming extremely hard to find because there is an acute accommodation shortage in Harare, a leading estate agent said this week.

Some firms are now moving out of the city to office parks such as Arundel and Mt Pleasant.

A spokesman for Southgate & Bancroft said the rentals business was currently “very brisk”.

“Business is very brisk right now,” he said. “Whatever property we get for rent just goes. Actually right now we don’t have anything for rent and I think this is mainly because there is a shortage of accommodation in Harare.”

He said even office space was hard to find in the capital city.

“There is no stock at the moment,” he said. “Garden flats are also being snapped up quickly because individuals sometimes turn these into offices so they live and work from one place.”

He however said on the sales side business was rather slow and individuals were finding it difficult to secure land which had recently shot through the roof.

There is speculation on the property market resulting from foreign currency transactions being conducted on the parallel market where the British pound is nearing the $10 000 mark against the Zimbabwe dollar among dealers.

Landlords are, however, holding on to their properties anticipating that prices will skyrocket when the financial services sector returns to normalcy after having been given a whipping by the RBZ in their new monetary policy.

Zimbabweans, especially those living in the United Kingdom, have caused the jump in property prices as they keep sending pounds to snap up land and equipment in the country.

“There isn’t much as far as sales are concerned,” another estate agent said. “Maybe it is because prices have increased too much during the past few weeks such that even those living abroad are now finding it difficult to buy. Properties in low density areas have also gone up very much and are costing around $500 million today.”

The spokesman said houses in high-density suburbs such as Budiriro, Glen View and Highfields were going for as much as $150 million.

“A half acre stand in Mt Pleasant is going for $100 million and this is before one begins to build. So you can imagine what one needs to complete a house nowadays. The sales side of the business is very slow.”

A spokesperson fromGuest & Tanner said business was fair on the renting side especially within the middle-housing sector but was difficult as far as sales were concerned.

She said garden flats were also very popular among tenants.

“Garden flats are in great demand,” she said. “In fact all types of properties for rent are wanted by various individuals right now. However, sales are difficult to conduct right now and sellers tend to hold on to their properties when they feel the price being offered is not high enough.”

A spokesperson for Redfern & Mullet said residential sales were very quiet but houses within the lower ranges were selling much faster than the more expensive ones on the market.

“It is easier to sell houses in this range,” she said.

Residential properties continue to seek very high rentals as the country’s inflation figure remains very high.

The RBZ said annually, the overall rate of inflation declined from a peak of 623% in January, 2004 to 394,6% in June.

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