Housing Finance in Zimbabwe


For the French version of this country profile, click here.

To download a pdf version of the full 2018 Zimbabwe country profile, click here.

Zimbabwe’s inflation, pegged at 0.21 percent in March 2017 by the IMF, is now expected to be at 5 percent by the close of 2018. Inflation continues to be an issue since the adoption of the multi-currency economic regime in 2009 with the US dollar serving as the primary currency.

As at 30 June 2018, the number of licensed banking institutions remain constant at 20 operating banking institutions including the central bank, thirteen commercial banks, one merchant bank, four building societies and one savings bank. Under the Reserve Banks financial inclusion drive there has been noteworthy movement with the registration of microfinance institutions from 168 in June 2016 to 187 in June 2018.

The four functioning building societies, National Building Society (NBS), FBC Building Society, CABS, and ZB Building Society are the country’s major source of housing finance.

Zimbabwe continues to witness an increase in access and affordability of housing finance, due torelaxation of the terms and requirements in some housing development projects. Although credit risk is taken into account by housing finance lenders, the interest rates for most borrowers remain unchanged, with 8-16 percent a year for regular borrowers, 6-10 percent a year for prime borrowers with low credit risk, and 10-18 percent a year for borrowers with high credit risk.

Housing continues to take centre stage in Zimbabwe’s developmental discourse, however the lack of traction gained from consecutive proclamations and incongruent resource allocation casts into doubt the level of commitment of the national authorities to meeting housing challenges. It is estimated that Zimbabwe needs 20 years to clear the 1,3 million housing backlog. The new ZANU PF election manifesto, The People’s Manifesto, which will steer policy now the party has won the general elections, makes bold projections for housing delivery, promising 1.5 million new houses in the next five years (2018 to 2023).

A report by Old Mutual Securities showed that the property market in Zimbabwe continued to be depressed up to the first quarter of 2018, and attributed this to a subdued economy. The effect of the unstable economic environment on the property sector included “increased voids, arrears, decreased property returns and values across the board.”

A strong institutional and regulatory framework shapes the housing sector in Zimbabwe. Much of the legislative and policy frameworks in Zimbabwe have remained unchanged. Some analysts observe that major challenges in the sector may stem from inadequate institutional capacity to support the effectiveness of these laws.

The Zimbabwean economy, sometimes alluded to as a sleeping giant, has for the first time in a long time seen glimpses of that potential on various fronts, including international re-integration and re-admittance into international financing forums. A lot of interest has been generated since the government transition in November of 2017. Several international investors and investor groups have flown into the country, drawn by the administration’s efforts to attain legitimacy as a safe investment haven. Policy still remains a contentious subject as not many changes, although touted, have been effected yet.

Find out more information on the housing finance sector of Zimbabwe, including key stakeholders, important policies and housing affordability:

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2018 edition, which has up-to-date profiles for 54 African countries.

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