New Vision (Kampala)

20 January 2013

Uganda: Govt to Engage Private Property Developers

Private public partnerships (PPPs) which are on many occasions used in business ventures will be introduced into home construction to ensure that Ugandans obtain affordable shelter.

Daudi Migereko, the minister for lands and housing, said the Government will partner with real estate developers in satellite city development to ensure that the looming housing shortage is solved.

"There is a lot of congestion, especially in urban centres, and solving this would require a concerted effort between the central government and the private sector," he said recently during a meeting with real estate dealers.

UBOS has reported that Uganda has a housing deficit of 550,000 units, of which 160,000 is in urban areas.

Kampala alone has a housing deficit of 100,000 units.

Peter Mugimba, the secretary of Uganda Property Developer's Association, called upon the Government to develop infrastructure such as roads, electricity and water within their estates.

"These constitute over 60% of our costs in estate development. We also urgently need affordable long-term financing," he said, adding that only when the demand side of houses among Ugandans is boosted through subsidising mortgages by offering stimulus specialised packages, will the housing sector recover and be put back on the growth path," he said.

Mugimba said the private sector is bogged down with lack of finances thus limiting its performance in housing finance and construction and called for the strict enforcement of physical planning laws and regulations by urban authorities like the KCCA.

"As a result, we will have decent organised housing units, a move which will boost the value of housing units and rental charges within Kampala and its suburbs," he said.

In its recently released report, UBOS revealed that general construction activity slowed down from 6.7% in 2010/11 and 15% in 2009/10 to 3.2% in 2011/12.

This downward trend has been blamed on the volatility of the Ugandan shilling against the dollar, high inflation rates and high interest rates for both residential and commercial mortgages, which ranged between 20% and 30% for most of last year.

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