Landlords in a fix as rentals drop

Landlords in Harare are in a fix as the prevailing cash shortages has triggered a reduction in both residential and commercial property rentals.

A survey of estate agents and landlords by Harare News revealed that rentals have tumbled by rates of 15 to 50 percent depending on the area.

A one bed-roomed flat in Harare's avenues area which used to fetch $450 in monthly rentals is now attracting between $250 to $350 depending on the state of the property.

Upmarket flats in the Avenues that used to attract $1,000 to $1,200 have since reduced to $800.

Similarly, rentals in most high density areas have dropped from around $60 per room to $50 or less.

Rent for commercial properties in the CBD have also fallen as tenants seek cheaper office space that to match their diminished profit margins.

Landlords offering accommodation in upmarket, low density suburbs are feeling the biggest pinch, as departing tenants are increasingly difficult to replace.

Fortune Mandisona, owner of a Mount Pleasant house which he was renting out to a family said he has struggled to find a new tenant since the old couple that rented his house decided to move into a smaller home they had acquired through a mortgage being sponsored by now grown up children.

"Low density properties now take a lot of time to get a tenant replacement," Mandisona said.

"You would rather give in to a tenant's request for a cut in rental than wait for a new tenant who may not even agree to pay the amount that your old tenant has been paying.

"The default rate in low densities is higher too because if a tenant skips rental of, say, $900 in a single month, it gets difficult for them to afford double the next month."

Landlords renting in areas such as Chitungwiza can hold their profit levels by decreasing rents while accommodating more tenants.

Says Knight Frank Zimbabwe property consultant Washington Musiiwa, "There is a major kwashiorkor of jobs in the economy where the majority have been reduced to vending. When a family's circumstances change, most often it is in the wrong direction and involves cutting costs which no doubt leads to decreased demand for rentals."

Commercial property owners have not been spared the nightmares as businesses such as law firms have retreated to city outskirts where they are renting homes in cheaper and more tranquil environments with easier parking than in the CBD.

In the CBD a 26 square metre office might cost $200 per month whereas a full house with several rooms, free parking, and a borehole in nearby suburbs costs $300 to $500.

Property businessman Stephen Margolis says the situation is frustrating.

"Rentals are down and are still coming down because of the economic depression, cash shortages, people not paying… some are running away with your rentals," he said.

"Those who are paying are paying in bits and pieces. Some spaces spend months empty, people are negotiating rent downwards and you are forced to understand them because they have to survive too. So there are many frustrations."