By Felix Oketcho
Kampala: Moses Lutalo, Managing Director – Broll A Real Estate Professional with experience in East Africa. Skilled in Real Estate Asset and Fund Management on behalf of Real Estate Agents in Uganda has asked the government to set a new law that will ensure transparency, address the lack of code of ethics in the profession and ease access to finance for real estate investment.
Lutalo revealed these during the 9th annual International Real Estate Investment Conference in Kampala under the theme: ”Fast forward to the future noted that the sector is facing many risks including land issues, unsustainable developments, lack of transparency and no property index.”
“Government must urgently enact new real estate laws like tenant and landlord bill. To sort out Real-estate Investment Trust to bring sanity in real estates industry in future,” Lutalo said.
In the same vein, Hudson Mutalya- Standards Officer of the National Building Review Board asked real estate developers to deal with collapsing buildings and unplanned buildings in urban areas by adhering to set standards which he believes will attract huge investments into the sector and allow policy directives on urban developments.
Mutalya said the building sector regulator is considering declaring an amnesty period under which developers can comply with set standards. The decision is driven by the findings of a baseline survey conducted by the National Building Review Board showing 80%of the structures in the eleven cities are not in compliance with the regulations.
On thereother hand, Ms Catherine Nanteza, Chief Executive Officer of the Association of Real Estate Agents (AREA), said real estate is still very profitable.
“Whereas real estate is profitable, it needs a patient person. Retirement schemes have the goal of making profits for their members. So real estate looks unattractive for them since it takes a while to make a profit,” she says.
She however called for urgent reforms in the real estate industry to take care of rapid urbanisation and housing demands to serve housing clients better.
“Real estate sector is highly informal. While real estate contributes 10 per cent to Uganda’s Gross Domestic Product, it is unregulated. From brokerage, mainly manned by a briefcase, unethical middlemen, as well as unregistered players, regulation for the sector operations is key,” Nanteza stressed.
Bashir Juma Head of Business Development and Corporate Affairs Buganda Land Board in a related comment said that the real estate sector grapples with financing costs because it is capital intensive further diluting hopes of affordable housing.
He attributed the high cost of housing to the high cost of land, taxes as well as construction raw materials.
According to Pricewaterhouse Cooper’s report, dubbed: ‘Real estate 2020, ‘Building the future,’ the 21st century’s great migration to the cities will be well underway.
Sam Mabala from Cities Alliance advised developers to embrace technology in putting up modern housing units in urban centres saying Uganda inclusive cities will be swelling across the fast-growing countries in Asia, Africa, the Middle East and Latin America for example Pearl Marina City under construction on Entebbe road. But not all cities will prosper.
He noted that while some become great centres of wealth creation in a multipolar world, others are likely to fail. Global construction output is expected to almost double to $15 trillion by 2025, up from $8.7 trillion in 2012. Emerging markets in Asia will be the fastest-growing region, and sub-Saharan Africa is expected to be the second-highest.
“The burgeoning middle-class urban populations in Asia, Africa and South America will need far more housing.
Meanwhile, the advanced economies ageing populations will demand specialist types of real estate, while their requirements for family homes will moderate.
Cities will attract the young middle classes, especially in emerging markets. As intense competition for space increases urban density, apartments are likely to shrink. Developers will need to become more innovative about how they use space to deliver according to growing demands,” Mabala explained.