This house in the affluent Borrowdale suburb of Harare was recently put on the market for $6.2-million.
On her desk in a newly furnished office in suburban Harare, realtor Nicolette Ncube lays out the blueprints of an ambitious new property estate just north of Harare.
"Over here will be the lake, and these houses here," she motions to drawings of a cluster of homes, "these homes will be overlooking the lake; pretty neat."
Ncube's company is one of a consortium of investors planning an estate near Borrowdale, one of Harare's wealthiest suburbs. Local businesspeople and, as Ncube puts it, "a bunch of high net-worth diasporans" are part of the consortium.
The estate is targeting wealthy locals, but foreign-based Zimbabweans are also keen on land in the area, which will be sold at more than $50 a square metre, more than six times the going rate in other "low-density" suburbs.
"Yes, there is some interest in the high-end property market. People always assume that every Zimbabwean out there is working for a pittance, but there are a few doing really well, and they want to invest back home," Ncube says.
Some in the property business are surprised that Zimbabweans are buying property that is much more expensive than similar properties in the United States and England.
Gamble on investment
Pam Golding, one of Zimbabwe's biggest estate agencies, recently placed a property in Borrowdale on the market for $6.2-million.
"For that price, you could buy several mansions in Hollywood," says Tendai Chikore, a stock market fund manager who invests in shares in property companies such as Dawn and Pearl Properties. "Yes, there is a lot of interest in local properties from Zimbabweans abroad. But for me, most are buying in the lower end of the market." It is hard to find tenants who are able to pay the rent in the wealthy suburbs – Pam Golding has one house for rent at $4 000 a month – and so foreign-based Zimbabweans are focusing on investing in houses in the low-income areas.
Chikore says some investors are taking a gamble on building estates in the more affluent areas of Harare as they are banking on a return of wealthy Zimbabweans. "Perhaps there is a group of Zimbabweans, used to living in top-end gated communities elsewhere, who would want to jump in there. They are there, and they are buying, but they are only in the minority in my view."
One project that recently launched is a $250-million development called Beverly Hills Golf Estate, in which a local franchise of South Africa's Re/Max is involved. Residents would enjoy views of a golf course and a lake, with water-skiing and fishing on hand. A buyer taking the 20-year payment plan will pay $250 000 for a plot, but some paid $87 000 in cash – $58 a square metre.
Francis Nyambiri, head of Zimbabwe Stock Exchange-listed Pearl Properties, recently said property prices were generally slowing down, but "increases were noticeable in the lower end of the market".
Economic growth
With economic growth, the market would also pick up. "The country is poised for economic growth, and with such growth, opportunities for the real estate sector will increase."
Fund managers such as Chikore are increasingly looking to the Zimbabwean diaspora, not only in property, but also in other investments.
CBZ, the country's biggest bank, was the first to test the waters in 2011 when it floated a three-year "diaspora bond". The flotation defied all doubts, raising $42.5-million from Zimbabweans in the diaspora and other investors.
But many investment managers in Zimbabwe who have been trying to lure diaspora dollars into Zimbabwe say the lack of credible data on investment markets at home remained a major hurdle.
"A Zimbabwean in New York or London can only go by what they hear; and as soon as they log in to the internet for news from home, it is usually not very good news," Chikore says. "So the struggle is to get the real data to them; to show them that there really is opportunity."