THE property market was subdued this week as sellers feared being caught up in a Reserve Bank-sanctioned blitz on holders of huge cash amounts and risking
losing value because of the chaos over the redenomination of the local currency.
Industry players this week said sellers had temporarily halted disposal of their properties, fearing they could end up with large sums of money which they might fail to deposit in the banks under a tight anti-money laundering regime by the central bank targeted at suspected economic saboteurs.
Real Estate Institute of Zimbabwe (REIZ) president, Nico Kuipa, confirmed to businessdigest that the property market had been quiet since Reserve Bank of Zimbabwe (RBZ) governor Gideon Gono’s monetary policy last week.
Under the recent monetary policy, individuals are barred from carrying amounts of more than $100 million in old currency, which is equivalent to $100 000 of the new bearer cheques.
They also cannot deposit cash equivalent to $100 million (or $100 000 of the new bearer cheques) unless they have tax clearance certificates from the Zimbabwe Revenue Authority. The central bank says the measures are meant to combat money-laundering under the Bank Use Promotion Suppression of Money-Laundering Act as well as fight inflation.
“I would not rule out that sellers are afraid to be questioned by police if they make transactions that involve large sums of money which they might fail to deposit,” Kuipa said.
He said uncertainty had gripped the property industry with both sellers and buyers unsure which direction the market would take during the on-going clamp-down on holders of huge cash amounts.
“There is still confusion regarding prices. There are a number of incidents where potential homeowners are inquiring about houses being sold in revalued currency thinking they are to let,” said Kuipa.
A house for sale which was costing $30 billion is now being quoted at $30 million in revalued currency. A house to rent costing $20 million is now $20 000.
Some potential homeowners are said to be afraid of being caught in the clampdown on suspicion of trying to offload large sums of money stashed at homes if their transactions are not done through wire transfers.