Govt passes revised housing policy

HARARE - Zimbabwe has passed a revised national housing policy targeted at addressing the surging demand for homes and facilitate financing for property development.

The policy will be launched within a fortnight.

The country, which has a housing backlog of over two million units, has failed to provide adequate houses to the majority of its citizens due to liquidity challenges in the economy and high finance costs.

David Munyoro, Housing ministry permanent secretary, said government crafted the policy as part of efforts to encourage investors to venture into the construction and real estate sectors.

“Our role as a ministry is to facilitate investor participation in the real estate sector,” Munyoro said at the Zimbabwe Real Estate Investment Summit yesterday.

The policy also seeks to promote housing cooperatives, improve networking and stakeholder co-ordination and as well as create a database in the housing delivery programme.

“Government used to be the source of long-term funding in the sector, but failed to continue with the financial assistance due to the hyperinflationary period and liquidity challenges in the country, leaving a funding gap which has been difficult to fill,” he said.

In his 2013 National Budget, Finance minister Tendai Biti said the housing policy offered greater scope in the provision of housing and social amenities.

He said the policy views shelter as the right for all citizens.

In its quest to provide affordable housing, government has also introduced incentives to boost the mortgage market.

“Discussions are currently underway with all players in order to address the question of interest and tenure of the mortgage bonds,” said Biti adding that there would be amendments of Income Tax Act in relation to mortgage financing.

“In terms of the current law, exemptions are provided to building societies from paying income tax, in order to encourage commercial banks to offer mortgage finance a similar exemption is being offered but only in relation to strict mortgage transactions,” he said.

Government is currently amending Statutory Instrument 308 of 1986 so that it covers any banking institutions offering mortgage finance, as part of efforts to attract mortgage finance.

Paid-Up Permanent Shares (Pups) were introduced in Zimbabwe through Statutory Instrument 308 of 1986 to enable building societies to raise long-term funding for periods up to two years.

The Pups were designed to mobilise private sector funds for housing by enhancing building societies’ competitiveness in attracting deposits.

The conditions were that at the end of each financial year, every building society had to make up a quarter (25 percent) of the mobilised funds available for low-income housing.

“We are thus reinstating the tax exemption status, as was the case in the past, from 2013,” said Biti. - John Kachembere

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