Thousands of Zimbabweans are set to benefit from the National Social Security Authority (NSSA) building society low-income housing scheme that will see properties being availed to civil servants and the average worker through low cost mortgage loans.
The scheme, which will fall under NSSA’s newly formed National Building Society (NBS) will see beneficiaries paying monthly payments of an average US$200 that will be much less than existing mortgage rates around which are beyond the reach of many.
A recent survey showed that building societies such as FBC, CABS and CBZ have mortgages of between US$150 000 and US$200 000, with home seekers expected to pay deposits of between US$20 000 to US$50 000 as well as monthly submission of about US$2 000 for more than 10 years.
The salary requirement for a client to qualify for such schemes is US$5000.
Construction of the first set of houses under the NBS, will be unveiled in Harare this year, with the first set of occupants expected to move in by 2017.
While official costs of the apartments are yet to be unveiled, indications are that total prices of the homes will be around US$15 000-with the monthly mortgage payable over a period of about 10 years.
This means monthly premiums will likely be under US$200, a figure that will be affordable to many working Zimbabweans, given that the subscriptions will be paid while beneficiaries will be occupying the homes.
Models under the scheme include semi-detached apartments, flats as well as apartments with alternative building technologies.
The housing projects are yet another initiative in line with the Zimbabwe Agenda for Sustainable Socio Economic Transformation (ZimAsset) plan to ease housing shortages.
Under ZimAsset, Government has set a target to build more than 300 000 houses by 2018 to ease the housing backlog which currently stands at about 1,25 million.
The new initiative is also seen as a wise investment option for NSSA, which has been under fire for putting pension contributions to bad use after committing the funds to ill-fated ventures such as the failed Interfin and Capital banks.
NBS is also seen as part of NSSA’s mandate to provide tangible benefits to contributors before they reach retirement age.
Public Service, Labour and Social Welfare Minister Prisca Mupfumira last week told The Sunday Mail that Government had directed NSSA to have the building society in place by end of March this year.
She said Government was “delighted” with the new development as it would allow a considerable section of the Zimbabwean population to become homeowners.
“We are delighted about this development as it is part of delivering housing to the people under ZimAsset. It is part of the revitalisation of NSSA so that pensioners’ funds are put to good use.”
Minister Mupfumira said progress on NBS was going on well after the company received funding for its operations.
“I have given the directive to NSSA that the building society should be up and running by the end of March so it is work in progress as they are currently setting up the structures and everything is going on smoothly so far.
“Recently, they were funded to the tune of US$10 million so a lot of progress has been made. They also acquired a licence from the RBZ to operate,” she said.
In an interview last week, NBS managing director Mr Ken Chitando said the housing scheme was tailor-made for low income earners as beneficiaries would pay monthly benefits that are comparable to what they would ordinarily fork out as rent.
“The predominant beneficiaries of this scheme will be the mass market who are in need of affordable housing.
‘We want a situation where people will be able to substitute rentals that they are currently paying with monthly mortgage subscriptions,” he said.
According to Mr Chitando, NSSA is expected to transfer some of the land that it currently holds to the NBS for the initial phase of projects under the scheme.
“To date we have already sourced some of the land. NSSA has various land banks which we will initially make use of. However, we will not be limited to NSSA’s land only but we will work with companies and other relevant institutions to acquire more land,” he said
Mr Chitando said the housing scheme will be rolled out in phases with construction of the first units set to begin in Glaudina Harare later this year.
On licensing, Mr Chitando said the building society had acquired a temporary certificate which would allow the entity to operate before acquiring a permanent licence.
“NBS is regulated by RBZ. We have been given a provisional licence that will be made permanent provided that we meet certain conditions,” he said.
“We are now in the process of meeting these conditions which include acquiring the minimum capital of US$25 million, putting in place policy procedures, establishing the ICT network, recruiting and training of staff among other things.
“We are confident that we are on track to meet all these requirements ahead of our anticipated launch by the second quarter of the year.”
Government has launched the Housing Delivery Strategy in Zimbabwe, which will run until 2018, and is expected to significantly reduce the housing backlog through the provision of more than 300 000 houses.
The Housing Delivery Project targets about 105 935 housing units in Harare, 56 760 in the Midlands, 28 772 in Matebeleland North, 23 818 in Mashonaland West, 21 830 in Manicaland, 20 269 in Masvingo, 16 607 in Mashonaland Central, 15 100 in Bulawayo, 12 500 in Matebeleland South and 11 776 in Mashonaland East.