LOW-income earners’ dreams of owning a house are soon to be realised following the unveiling of a housing micro-credit facility by a local financial institution, Vantage.
The model is such that one is given an opportunity to pay for the development of their house by way of small but regular instalments, some even paid on a daily basis.
This development comes against the backdrop of the signing of an agreement which saw Vantage purchasing 3 000 of the 6 700 stands on 350 hectares of land in the Spitzkop area of Snake World.
Vantage managing director Mrs Happiah Revai told The Sunday Mail Business that her organisation has taken advantage of the gap in property funding products seeing that traditional development institutions did not seem to have solutions for the low-income earners who make up the majority of the population.
“The past 10 years’ economic hardships have seen many Zimbabweans come out of formal employment and joining the informal sector. As they need housing, these people are coming and taking up this credit facility.
“The facility is targeting informal traders as well as vendors, some of whom will be paying as little as US$4 a day towards their instalments. Interestingly, there are more women coming up to apply for this facility than men. Women are more reliable in making repayments and their default rate is very low,” explained Mrs Revai.
The area has over 3 000 stands, the bulk of them measuring 200 square metres.
Housing is one of the biggest challenges facing Zimbabwe’s socio-political economy today.
While food security has been largely achieved and clothing today is not a serious problem for the poor, shelter remains beyond the reach of millions even after 31 years of independence.
Mrs Revai added that Housing MicroCredit consists mainly of credit to low- income people from informal, rural and semi-urban areas for renovation or expansion of an existing home, construction of a new home, land purchase and basic infrastructure.
“To date most of the successes in this new field have been with home improvement credit. Land purchase and new housing construction are still dominated by subsidies, rather than microcredit services, hence the slow development which our organisation is coming to service,” she said.
Presently, the City of Harare’s waiting list is estimated to have 700 000 people, mainly low-income earners who are looking for stands or affordable core houses.
In Zimbabwe there is no appropriate credit supply for housing credit for low- and middle-income groups.
According to statistics, there are 1,2 million households without houses and 0,5 million living in unserviceable shanty structures.
It has also been estimated that another 1,2 million houses would be needed to cover the population growth during 2010-2015, at the rate of an annual growth of 0,3 million homeless.
Market research further indicates that about 40 percent of the total of rural households remain in one-room tenements, 30 percent in two-roomed houses and 13 percent in three-room units or more.
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