Ishemunyoro Chingwere Business ReporterThe real estate industry will continue to hold forte in the short to medium term despite challenges bedevilling the economy as more people turn to the sector for store of value, an industry expect has said.
Speaking in an interview with The Herald Finance and Business, Realtor Ville Real Estate managing director Mr Aaron Kumanja, said although the economy is saddled by dwindling disposable income among citizens, real estate has managed to remain profitable.
Government under the new dispensation has identified housing and infrastructure development as key in the quest to revive the economy, improve people’s lives and the attainment of an upper middle income economy by 2030.
“Real Estate industry thrives even when an economy is tough because it’s the only industry which preserves value for money,” said Mr Kumanja.
“So in our economy, you will note that a number of people are opting to hold on to value either by keeping money in US Dollars or in immovable property,” he said.
Mr Kumanja, however, noted that the sector has not been sparred by some of the challenges afflicting the economy most of which have been a result of Government having been made to reconfigure the economy in a bid to foster growth.
The inability by financial services institutions to extend mortgages has also compounded the situation as the trend world over is that these are the ones that oil the sector as very few people in the working class can afford to save enough to buy a house.
“Disposable income is dwindling each and every day making transactions difficult. This has also been compounded by the fact that banks are not giving out mortgages as under normal circumstances mortgages should be the ones driving the sector,” he said.
Unlike in 2008 where value for property was eroded resulting in the sector being dominated by the diaspora, the Realtor Ville Real Estate managing director said current trends are that about 70 percent of the transactions going through are being done by locals.
Mr Kumanja, through his Realtor Ville Real Estate, run multimillion dollar housing projects that straddles across the country.
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