Property – Seeff Zimbabwe says property is safe haven


Staff Writer

LEADING estate agents Seeff Zimbabwe (Pvt) Ltd says the residential property market is the safest investment to protect one against the country’s unstable economic environme

nt.


In its latest report on the property market released last week Seeff managing director John Spicer said although many Zimbabwean property owners believed that they had become wealthier since 2002 when the current interest rate regime was initiated and ignited hyperinflation, the increasing gap between the haves and the have nots, including everyone with a local pension, had become more marked and would increase.


“Most Zimbabweans will be living in more dilapidated badly maintained properties or shacks than ever before, and the price of secure homes maintained to international standards will increase dramatically as the cost of professional building and maintenance continues to escalate slowly,” Spicer said.


He said the value of secure homes maintained to a professional standard had doubled in United States dollar terms since January.


“However safe an investment property is, many owners do not realise that lack of maintenance, poor security, title deeds with potential litigation, or promises of services not yet supplied, when escalating services are collapsing, will all undermine the value of your assets,” he said.


“Since the international market is the true source of maximising returns in the residential market, advice from established professional companies with existing contacts and outlets in international markets is essential.”


The managing director said the recent appearance of three property companies on the Zimbabwe Stock Exchange, quoting the same advice the agent had been giving to clients for more than two years as strategies for their investment verified the professional approach that was now necessary to procure a lucrative investment in this environment.


Dawn Properties, Mashonaland Holdings Ltd and Willdale Ltd are listed on the bourse and have told shareholders that they will concentrate on the property market.


The market has become popular because it is said to be a hedge against spiraling inflation.


“Owning something is better than having cash in a bank or building society, but if neglected or badly invested, the security of your brick and mortar could be an illusion,” Spicer said.


“Agents and investors refer to people’s homes as stock. Markets are dominated by the availability of stock and buyers.”


Commenting on the stock or residential property available for sale at market value, Spicer said the country’s hyperinflationary environment had resulted in a demand for equity or fixed assets that help protect investments.


He said the skewed interest rate regime had created a local boom in borrowing at basically sub-economic rates.


“In international terms our prices have declined significantly over the last five years, and building and maintenance costs have soared,” Spicer said. “Well maintained secure residential property in Lusaka or Nairobi are two or three times current prices in Zimbabwe. The acute shortage of stock is driving prices up, but most international buyers seem unaware of the escalating trend on the United States price of property.”


Spicer said for sellers the advice would be that if one was unable to maintain or improve their current home or investment they needed to rationalise.


“Buy something you can afford to maintain in good condition,” he said. “Use a reputable professional agent with international marketing facilities and experience.”


He said for buyers the advice was buy now, despite the political and economic situation facing the country.


“Be acutely aware that where and what you invest in can severely affect the value of your investment,” Spicer said. “Seek professional advice.”