Property developers lament exclusion from RBZ facility

Conrad Dube

THE directors of Housing Forum have lamented the exclusion of housing development from the Reserve Bank of Zimbabwe (RBZ)’s productive sector support facility.



T face=”Verdana, Arial, Helvetica, sans-serif”>The forum which comprises housing directors from urban councils, municipalities, towns and local boards said an opportunity might be lost by the RBZ to boost the economy by not classifying housing as productive sector.


“The RBZ did not classify housing development under the productive sector although spending on habitat is an investment in as much as the capital stock increases. This approach has been criticised because it ignores the multiplier effect housing has on the entire economy,” said Admore Nhekairo directors forum treasurer and Marondera municipality housing director.


“It is recommended that the central bank should not take the traditional approach of viewing housing as a consumptive capital but should look at it as productive sector.”


The productive sector facility, which was ushered in by the RBZ governor Gideon Gono in his 2003 monetary policy statement sets aside cheap funds to resuscitate the productive sector in order to boost productivity and exports.


The directors also rubbished the central bank’s proposed Homelink Housing Development Scheme saying the $750 billion set aside under the facility is not enough judging by the level of interest in the facility as claimed by the RBZ.


“The RBZ is hard-pressed to meet the foreign currency requirements to finance the purchase of residential stands or completed houses. If no effort is made for the Homelink initiative to result in additional housing stock being delivered the result will be the spiralling of prices of both residential houses and stands due to overcrowding of buyers chasing limited stock,” Nhekairo said.


Under the Homelink initiative, the central bank will license promoters who will include real estate agencies, building societies and licensed money transfer agencies with twinning arrangements with the real estate and international partners.


The directors said the kind of promoters that have been chosen preferred housing investment portfolio will be the purchase of serviced stands, construction of houses and the purchase of completed houses. The major problem in housing delivery in Zimbabwe has been harnessing of funds to service residential stands since actual construction has been through self-help means, they lamented.


“If the initiative is to make a real contribution, the National Housing Programme as espoused by government should have a mechanism in place to ensure diaspora remittances also fund the servicing of surveyed stands.


“This can be achieved by setting aside a portion of Homelink funds that should go towards servicing of stands and ensuring that there are partnership arrangements of promoters with land developers who have experience in delivering serviced stands,” Nhekairo said.


Nhekairo said the major aim must be to ensure foreign currency inflows through the formal sector and the thrust must be to create housing stock.

“This will ensure that jobs are created and it will also ensure a boost in the construction sector. If there is no stock, the diaspora will crowd the local market and this will push prices up,” he said.


The National Housing Delivery Programme aims to clear the urban housing backlog by 2008 through the acquisition of 310 406 hectares of peri-urban land to achieve the planned target and reforming the current housing delivery system in order to increase the number of players involved and consequently output.


Harare’s housing backlog has increased more than one million according to Ministry of Local Government November 2003 statistics.