TO hedge against spiralling inflation the Institute of Personnel Management of Zimbabwe (IPMZ) last year secured an $8 million property in Harare’s Hillside suburb.
The organisation, largely funded by business enterprises who pay annual membership fees, bought the property for $8 112 544 using a mortgage secured from the Central African Building Society (Cabs).
The mortgage is repayable over 25 years and attracts interest at a rate of 30%.
The residential property had a net value of $11 650 938 as at December 31 2002 but could now be worth more than $50 million judging by the sky-high property prices caused by the country’s inflation.
Inflation stands at 364,5% but analysts predict it will soar and bash the 500% mark by year-end caused mainly by the unavailability of consumer products, rising fuel, electricity and transport costs, as well as the black market for elusive foreign currency.
“We did buy the property to hedge against spiralling inflation and to enable us to have something to physically exist for members. I think members will be very happy about the council’s move to do so,” said an IPMZ official recently.
“In fact we have now almost fully paid for the house which is currently being leased out to a private tenant.”
The official said the IPMZ presently owed Cabs less than $10 000 for the property.
The move comes as leading companies including those listed on the Zimbabwe Stock exchange are investing in the lucrative property sector to hedge against inflation.
Property prices have begun to soar also because of Zimbabweans living abroad who are able to buy posh houses in cash when they change their hard currency on the black market.