The state of the Zimbabwe real estate market in 2023

Seeff breaks down the current state of the Zimbabwe real estate market, sharing what buyers and sellers can expect as they explore property options.

The negative impact of the COVID-19 pandemic cannot be overstated. However, Patience Patongamwoyo, a Property Practitioner for Seeff Zimbabwe, reports that the Zimbabwe real estate market is seeing plenty of activity in the wake of the pandemic.  

Seeff is here to provide guidance for buyers interested in property investment and sellers looking to sell property in Zimbabwe. Let us help you navigate the market amid the persistent economic challenges.

Economic factors affecting the Zimbabwe real estate market

The current interest rate sits at 150% which is hiking up borrowing costs. Another notable trend is that sellers often prefer US dollars, which also increases expenses for buyers. If you are keen to buy property in Zimbabwe, it is crucial that you take note of the following economic factors impacting Zimbabwe real estate: 

• Weak currency.
  
  
• High-interest rates.
  
  
• Depressed disposable income.
  
  
• Unfavourable mortgage facilities.
  
  
• Exchange rate risks.

However, there is still hope for buyers in the Zimbabwe real estate market. Partnering with a trusted local Property Practitioner can make a significant difference in navigating the economic challenges, as their expertise and in-depth knowledge of the local market dynamics can offer valuable insights.

With their support, you can make informed decisions, seize opportunities that align with your needs and budget, and increase your chances of finding the right property.

Zimbabwe real estate market: Top considerations

To achieve desired results in the Zimbabwe real estate market, individuals must make note of the following:

• To avoid overpricing, sellers should ensure they are well informed of the current market trends and property prices, as well as be on their guard against unethical Property Practitioners who manipulate property prices. 
  
  Additionally, sellers should anticipate transaction delays as a result of the strict mortgage financing system.
  
  
• The lack of a standardised pricing system leaves buyers with the challenge of overpaying, while also failing to understand the importance of working exclusively with a trusted Property Practitioner. Education is key - buyers can explore a variety of expert real estate resources to equip themselves for buying property.  
  
  Buyers looking to invest in new developments should also be aware of a common and unfortunate trend: developers often compromise quality to reduce costs and time.
  
  
• For landlords, recovering outstanding amounts is often a challenge. Late payments and defaulting tenants are not uncommon. To combat this issue, landlords should make rental investments wisely, ensure proper vetting for prospective tenants, and plan ahead to ensure they have sufficient funds in case of unexpected issues.  
  
  
• As for tenants, they often grapple with reclaiming their security deposits at the end of their lease as landlords make excuses to hold onto the funds. Overpricing and landlords who fail to maintain their properties properly are additional challenges for tenants. 
  
  In light of this, Seeff insists upon legislative intervention to safeguard the interests of all parties involved. 

Zimbabwe real estate market: Residential property

The residential sector is performing well in the Zimbabwe real estate market, mainly due to demand from the diaspora and foreign buyers with higher disposable income. Although accurately priced properties tend to sell quickly, well-informed buyers typically purchase properties at an average price of 80% below the asking price. Sellers should ensure they set realistic asking prices to avoid disappointment.  

As buyers are influencing asking prices, it is safe to say that it is a buyer’s market at the moment.

• Local residential buyers tend to look for more affordable properties and flexible payment terms, such as serviced residential stands and properties with title deeds.
  
  
• High-income earners favour residential properties that provide more comfort and security, such as luxurious homes, secured gated communities, and cluster homes.

• High-density buyers typically look for affordable housing options and therefore tend to buy properties in the lower price ranges. This demographic primarily consists of civil servants, mining workers, and employees who benefit from Employer Assisted Mortgage Schemes.
  
  
• Medium-density buyers include emerging entrepreneurs, farmers, young couples, miners, and business executives.
  
  
• Low-density buyers are typically affluent individuals seeking opulent homes that provide comfort and security. This category includes diasporans, tenderpreneurs, senior civil servants (government officials), and business executives.

The price ranges for suburban properties by density are:

• High-density suburbs: USD17,000 to USD40,000
  
  
• Medium-density suburbs: USD50,000 to USD120,000
  
  
• Low-density suburbs: USD150,000 to USD1 million.

The Zimbabwe real estate market: Commercial property

The demand for office space in the Central Business District (CBD) is declining as businesses choose to operate from suburban areas instead. However, Seeff notes an uptick in demand for industrial properties as several industries boom, notably mining, agriculture, and logistics.

At the same time, the rental market is going strong as small and medium enterprises flock to rent retail spaces in the Harare CBD. Individuals are pivoting to meet this demand by repurposing their properties into rental spaces. 

Rental prices in the Zimbabwe real estate market

In the Zimbabwe real estate market, rental providers quote rental prices in USD and adjust local currency rentals based on the current exchange rate to effectively manage the exchange rate and inflation risks.

• Retail properties in the CBD have an average rental range of USD18 to USD28 per square metre. The estimated average yields for retail properties in the CBD range from 6% to 7%.
  
  
• Office rentals vary from USD6.50 to USD9 in the CBD and USD12 to USD18 in suburban areas. Offices in the CBD achieve an estimated average yield of 8%.
  
  
• Industrial properties have rental rates ranging from USD5 to USD7.50, while they achieve an estimated average yield of 11%.

These market trends highlight the importance of partnering with a reputable real estate agency. By building trusted relationships over the years, today, Seeff is one of the leading real estate agencies in Southern Africa. Allow us to guide you to find your perfect home or secure a successful sale.

Get in touch to successfully buy or sell property in the Zimbabwe real estate market.