Once upon a time, I fancied a colossal home. I do find myself green with envy from time to time when I come across the grandiose homes, but that soon wears off when I start to calculate the cost of maintaining the property amongst other matters.
Is it true that Warren Buffet still stays in the home he bought in 1958; and that it is the third best investment he has made to date? Warren does own another home valued at 11 million Trump dollars. The same goes for Bill Gates. He once commented that at the beginning of his wealth journey, he allowed himself 1–2 luxuries like a Porsche and a big house, but then got back to business, and he now prefers the simple life.
Anyway, enough about America, let’s get back to Zimbabwe and what I would like to focus on; the current housing and property investment trends based on my “limited” experience and knowledge. This post is for the first time home buyer, the medium risk investor, those looking to downsize as well as those needing to sweat their assets a bit more.
1. SECTIONALise – less is more
World over, property developers, real estate investors and property buyers have been responding to the growing demand for sectional title properties in what appears to be a long-term trend for the demand for lock-up-and-go, hassle-free sectional title units. The need to be in accessible areas that are close to the workplace and all amenities continues. This need has been propelled by both lifestyle and economic reasons within Harare and growing cities. With this, you forego the hassle of looking for land & the building drama.
Sectional title ownership means that you own your unit (or section) and that you have ownership of an undivided share of the land and common property of the complex.If you are starting out in real estate, a sectional arrangement is one of the best ways to dip your feet into the market. Foregoing a garden is something you can live with. One can create their own indoor garden easily.
2. SUBDIVIDE & SUBLET- prioritizing quality over space
What are some of the reasons for subdividing you may ask. A few reasons come to mind; for profit, to pay for education needs as well as to allow loved ones to stay close by. There is also a growing need for home owners to unlock the value of their properties by turning their excess land or space into cash.
If you are like most people, you will be constantly thinking about your parents and/or your parents in love. At some point in time, they will need to be closer to their children and grandchildren as they continue to grow in wisdom. The proximity helps in making sure there is close monitoring and the much needed bonding. I know of a friend who has her mum staying within their property. She is available for baby-sitting duties and a trusted helping hand.
Subdividing to build & rent out is also “in”.
3. STUDENT ACCOMMODATION
At the younger end of the scale, student accommodation within close proximity to universities and tertiary institutions will prove increasingly popular. This includes conversions of houses which are then let out per room, giving investors significantly greater returns compared to a single lease over the property.
Think Midlands State University, Chinhoyi University of Technology, Great Zimbabwe University and many more. Students no longer want to be crammed in any space. They want the cool digs too, with just enough amenities to get on with their work and to chill out.
4. SELL & CONQUER
Vacant land is an extremely valuable resource and owning just a piece of land is securing a finite asset that a lot of people would want to be a part of. By default most vacant land owners are absentee owners who are mostly distant form the land, making them most likely to sell their land into multiple dwellings for cents on the dollar. You can both maximize on the available land and also at the same time generating a steady cash flow by selling out land for dwellings sites that can accommodate number of people. In this way you will not just be offering a number of families an area to call home (a great social service to the community) but also getting value for your land which was vacant.
A tip to always consider is extensive research on properties and the market around it, this will prove to be one of the defining factors as to whether you gain a steady cash flow or generating none at all.
Embarking on property investments largely banks on your ability to research the market, localisation and knowing what the market wants, hence before you dive deep into it make sure you do your research to get that $$$, because honestly, we all need it.