Why Properties are Expensive in Zimbabwe

 


Zimbabwe is a landlocked country in Southern Africa that has been grappling with various economic challenges over the years. One of the major concerns that the country is facing is the high cost of properties. In this article, we will analyze why properties are expensive in Zimbabwe and what factors are contributing to this trend.

1. Political Instability

Zimbabwe has been experiencing political instability for decades, which has led to economic turmoil and widespread poverty. The country has been under the rule of the Zimbabwe African National Union-Patriotic Front (ZANU-PF) since independence in 1980. The government has been accused of mismanaging the economy, corruption, and human rights abuses. The political instability has made it difficult for investors to have confidence in the country's economy, leading to a lack of investment, which has contributed to the high cost of properties.

2. Hyperinflation

Zimbabwe has a history of hyperinflation, which has severely affected the value of the country's currency. In 2008, the country experienced the world's second-highest hyperinflation, with the inflation rate estimated to be over 79 billion percent. This resulted in the collapse of the country's economy, with many businesses closing down, and property prices plummeting. Since then, the government has introduced measures to stabilize the economy, but the effects of hyperinflation are still being felt today, with the cost of properties remaining high.

3. Limited Land Availability

Zimbabwe has a limited amount of land available for development, which has led to high land prices. The country has a population of over 14 million people, with most of them residing in urban areas. The demand for housing has resulted in developers charging exorbitant prices for land, which has contributed to the high cost of properties.

4. Lack of Mortgage Finance

The lack of mortgage finance options in Zimbabwe has made it difficult for people to own homes. Most banks in the country do not offer mortgages, making it challenging for individuals to purchase properties. The limited availability of mortgage finance has resulted in a high demand for properties, which has led to an increase in prices.

5. High Construction Costs

The cost of constructing properties in Zimbabwe is high due to several factors, including the cost of building materials and labor. The country imports most of its building materials, which increases the cost of construction. Additionally, the cost of labor is high due to the limited number of skilled workers in the country. These factors have contributed to the high cost of properties in Zimbabwe.

6. Limited Infrastructure

Zimbabwe has limited infrastructure, which has made it difficult for developers to construct properties. The country has an inadequate road network, limited water supply, and inconsistent electricity supply. These factors have made it challenging for developers to construct properties, resulting in a limited supply of properties, which has contributed to the high cost of properties.

Conclusion

In conclusion, the high cost of properties in Zimbabwe is a result of several factors, including political instability, hyperinflation, limited land availability, lack of mortgage finance, high construction costs, and limited infrastructure. These factors have made it challenging for individuals to own homes, resulting in a high demand for properties, which has led to an increase in prices. The government needs to implement measures to stabilize the economy, improve infrastructure, and create an enabling environment for investment, which will reduce the prices.

Rugare Madzara

Guest and Tanner Real Estate (Pvt) LTD 

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