NSSF lost over Sh2bn in fallen banks: Report

 

NSSF building in Nairobi. Photo/FILE  Nation Media Group

By PAUL WAFULA pwafula@ke.nationmedia.com
Posted  Tuesday, September 18  2012 at  18:08

In Summary

• In its annual report and accounts for the year ended June 30, 2011, NSSF made a Sh2.1 billion provision as doubtful investments for the money deposited in closed financial institutions, a pointer that it has lost hope of recovering the money
• The report shows that Sh989.9 million was deposited in Prudential Building Society, Sh553 million went to Post Bank Credit Ltd, Sh197 million to Trade Bank, and another Sh166.5 million was deposited with Thabiti Finance Company. All these institutions are in liquidation
• Members also lost Sh1.2billion in 2009/2010 in respect of shares purchased through Discount Securities

The national pension fund lost Sh2.1 billion it had deposited with at least 10 financial institutions which have since gone into liquidation, its annual statement shows.

The statement gives the more than 1.4 million active members a rare peek into the financial health of the National Social Security Fund (NSSF) that had been hidden for 47 years. The fund was also duped into buying illegal forest land worth Sh1.13 billion in gazetted areas.

In its annual report and accounts for the year ended June 30, 2011, NSSF made a Sh2.1 billion provision as doubtful investments for the money deposited in closed financial institutions, a pointer that it has lost hope of recovering the money.

The report shows that Sh989.9 million was deposited in Prudential Building Society, Sh553 million went to Post Bank Credit Ltd, Sh197 million to Trade Bank, and another Sh166.5 million was deposited with Thabiti Finance Company.

All these institutions are in liquidation.

The pension fund also lost Sh131 million to Rural Urban Credit Finance, Sh57 million to Continental Credit, and Sh34.9 million to Pioneer Building Society, while Trade Finance went down with Sh6.6 million. The other financial institutions in liquidation include Middle Africa Finance (Sh3.6) million and Nairobi Finance Corporation (Sh3.3 million).

The Auditor General, Mr Edward Ouko, also questioned the firm’s investments in property in gazetted areas in Muthaiga, on Ngong Road and several irregular land transactions by the fund.

“The properties, being in gazetted areas… cannot be owned, possessed, utilised or accessed and any development on such land would be illegal. The carrying values of these properties, as at June 2011, stood at Sh1.13 billion yet no provision for the impairment loss was made in the financial statements during the year,” Mr Ouko said of the pension funds accounts.

Breach of laws

The fund also irregularly sold its Ojijo Road government gazetted plot for Sh303 million, in breach of procurement and disposal laws.

“The sale of the property was not advertised and it could not be confirmed how the buyer was identified and how the selling price was determined,” Mr Ouko noted.

He also took issue with Sh6.5 billion being held by NSSF in suspense accounts without indicating how the affected members would benefit from the money.

Members also lost Sh1.2billion in 2009/2010 in respect of shares purchased through Discount Securities.

Other areas the pension fund will have to deal with even as it goes ahead to shade off its old image as it seeks to transform itself from a provident fund into a pension fund include recovery of debts.

Bank deposits up amid liquidity woes in markets

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Monday, 14 January 2013 11:39

Prime Minister Mizengo Pinda opens a CRDB Bank branch in Mpanda. PHOTO | FILE Dar es Salaam. Scarcity of liquidity in the financial market, coupled with a widening of the avenues for portfolio investment and the coming of new commercial banks are the driving factors behind an increase in deposit rates during the past few months, experts say. This means that people who deposited their money with commercial banks during the past 14 months reaped some better interest earnings than those they earned before. According to CRDB Bank’s director of marketing, research and customer services, Ms Tully Esther Mwambapa, the scarcity of liquidity in the financial market was experienced following the tight monetary policy instituted by the Bank of Tanzania (BoT) to curb high inflation and the continuous depreciation of the local currency 14 months ago. As a result, the BoT said in its December 2012 Monthly Economic Review that annual growth of money in the financial system dropped to 11.1 per cent in November 2012 compared to 21.1 per cent recorded in the corresponding period in 2011, reflecting the impact of the tight monetary policy stance adopted by the bank. “Thus, the coming of new players made things even worse, forcing commercial banks to start competing for depositors’ money…..It is that competition that pushed up depositing interest rates though terms and conditions attached to these rates make them differ,” says Ms Mwambapa. She said as a result, her bank currently offers deposits’ interest rate of up to 6.5 per cent for less than Sh1 billion that stays in the bank for three months, up from a previous rate of 1.5 per cent in average. Consequently, for the six and nine months, the rates have also gone up to 7.5 per cent and 7.75 per cent from an average of 2.5 per cent and 3.5per cent respectively. For deposits that stay in the bank for 12 and 24 months, rates went up to 8.5 per cent and 9 per cent respectively from an average of 3.5 per cent for a less than Sh1 billion deposit. Deposits above Sh1 billion are subjected to a rate to be offered by the dealing room, which, according to Ms Mwambapa, mostly offers higher interest rates. The Tanzania Securities Chief Executive Officer, Mr Moremi Marwa, was recently quoted as saying that investors currently have wider investment options that range from deposits that fetch yields of 8 per cent on average, T-bills between 15 and 18 per cent and equity yields which fetch above 10 per cent. “This is good for investors as banks and equities are competing for funds….Those with huge funds are the ones who benefit most from the said banks’ interest rates including pension funds and fund managers,” Mr Marwa said. Last year, a number of banks ran promotional draws geared at attracting deposits while new entrants such as First National Bank of South Africa came up with competitive deposit interest rates of up to 12 per cent. The increases in return reduced the spreading between lending and deposit interest rates. According to BoT, overall time deposit rate increased to 8.56 per cent in June 2012 from 6.06 per cent recorded in June 2011, while lending rates for short-term loans of up to one year stands to an average rate of 13.92 per cent. “As a result, the spread between 12-months deposit rate and one-year lending rate narrowed to 2.82 per cent from 6.82 per cent recorded in June 2011,” the last July Monthly Economic Review report said. On other hand, World Bank report published in 2012 shows that the deposit interest rate in the country was last reported at 6.57 per cent in 2010.

Panic as PPF Tower floor burns

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Monday, 04 February 2013 10:38

By Frank Aman and Aloyce Mpandana The Citizen Correspondents Dar es Salaam. The 17th floor of the PPF Tower in the city yesterday caught fire, where properties whose value could not be immediately established were destroyed. The skyscraper located at the corner of Ohio Street and Garden Avenue, was built in 1999 by the Parastatal Pensions Fund (PPF). According to acting commissioner general of the Fire and Rescue Brigade, Mr Pius Nyambacha, the cause of the fire was yet to be established and investigations into the incident were still going on. He said, the fire destroyed some items that were in the 17th floor due to the lack of automatic fire detectors. “The building caught fire around 6am. However, we managed to evacuate people and extinguish the fire before it spread to other floors,” he said. Mr Nyambacha said, due to lack of vehicles that could extinguish fire in buildings with the height of more 57 meters, fire fighters were forced to break their way in to kill the blaze. According to PPF director general William Erio, tenants occupying the floor which caught fire yesterday are SevenSeas Shipping Agencies Tanzania and Abbot Fund. Dar es Salaam Special Police Zone Commander, Mr Suleiman Kova, said police would investigate the cause of the fire and report about the loss of properties soon. “It’s hard to know the cause of the fire at the moment,” he said. Dar es Salaam regional commissioner Said Mecky Sadick instructed the Fire Department to inspect all buildings to check whether they met fire safety requirements.

NHC set to build 900 low-cost houses

By Bernard Lugongo The Citizen Reporter Dar es Salaam. At least 900 low-cost houses to be allocated to wananchi on a loan basis are under construction in a programme run by the National Housing Corporation (NHC).The houses would be sold for between Sh25 million and Sh200 million, targeting both low-income and high-income earners. NHC has already surveyed 20 regions for the massive project which will be completed by 2015. With the ultimate aim of building 15,000 houses in the next three years, the NHC plans to begin with 3,000 houses each year, 1,500 of them specifically targeting low-income earners. The regions where construction is in progress include Dar es Salaam, Arusha, Dodoma and Mwanza where the major projects are based. Smaller projects are being run in Iringa, Mbeya and Mara regions. According to the NHC head of Corporate and Public Affairs, Ms Susan Omari, the survey in those regions was completed recently and was aimed at identifying sites for constructing houses and market premises.Ms Omari was addressing journalists yesterday in Dar es Salaam during an event to mark World Habitat Day, where NHC participated as one of the stakeholders in the housing sector. She said the survey was carried out by a special team which came up with a report that would give a path for starting the project in the regions. “The report has identified lands for construction work; soon we are going to make public where to find the houses,” she said. The project was sealed recently when the NHC signed a Memorandum of Understanding (MoU) with seven banks and two financial institutions to avail Sh165billion in loans for the construction of the houses. Banks that have signed the MoU with NHC are CRDB Bank (Sh35 billion), ECOBank (Sh2 billion), Banc ABC (Sh4.2 billion), NMB PLC (Sh26 billion), Commercial Bank of Africa (T) Ltd (Sh24 billion), Tanzania Investment Bank (Sh22 billion) and Azania Bank (Sh7 billion). Other financial institutions are Local Authority Pension Fund (Sh15 billion) and Shelter Afrique (Sh23 billion). To further enhance mortgage lending in 2010, the government with the World Bank’s support facilitated the establishment of a mortgage liquidity facility under a private company known as the Tanzania Mortgage Refinancing Company (TMRC). The TMRC, which will have the role of refinancing primary mortgage lenders, will start work before the end of this year, the minister revealed. During yesterday’s event to mark World Habitat Day, the government acknowledged that there was poor supervision of laws governing city plans, which was among major factors leading to unplanned settlements. Deputy minister for Works, Mr Greyson Lwenge, said district and city councils have not been putting enough enforcement into such laws.“I direct all councils to ensure that they follow firmly on laws on city plans to avoid unplanned settlements,” Eng Lwenge said. Unplanned settlements in the cities have been causing the areas to face severe challenges in provision of social and economic services due to poor infrastructure. “In order to bring development, the residents should have better settlements,” he said. Currently, Tanzania has a population of 12 million people, equivalent to 30 per cent, who live in cities. It is estimated that by the year 2030, about 50 per cent of the country’s population will be living in cities. For his part, Representative of the United Nations human settlement programme (UN-Habitat), Mr Philemon Mutashibirwa, called for an increase of opportunities in line with an increase of population in the cities.Mr Mutashubirwa was presenting a message from the UN Secretary General Ban Ki-moon on the marking of the Day.

Kwa nini michango ya pensheni isitumike kummilikisha nyumba mwanachama

Na Christian Gaya Majira 05 February 2013

Nyumba ina mchango mkubwa kwa upande wa uchumi, kijamii na kisiasa, na alama au muonyesho wa maendeleo na ustawi wa jamii katika nchi yeyote ile. Hivyo basi ni kitega uchumi ambacho kinachangia katika kupunguza kama siyo kuondoa umaskini kabisa, nyumba ni kitega uchumi ambacho kinachangia kuongezea ajira, kinaongezea mapato, kinaboresha afya na kuongeza ufanisi kwa nguvu kazi

Nyumba kwa mwenye nayo au anaye miliki ni rasilimali ambayo inawezekana kubadilishana na kitu chochote kwa vile kina thamani yake na ikatumika kwa vile ina thamani yake inayotambulika. Kijamii nyumba inachangia kuhamasisha na kuboresha nafsi ya mtu, utu, usalama na kutambuliwa mbele za watu. Kisiasa, nyumba bora inapunguza vitishia vya kisiasa vinavyotokana na kugandamizwa na kuchanganyikiwa hasa kwa watu wanaoishi kwa mazingira hatarishi na makazi yasiyokuwa rasmi

Kutokana na upeo wa michango au mafao ya pensheni, umilikaji wa nyumba ni sehemu ya upangaji mzuri wa jinsi ya kustaafu. Kumiliki nyumba wakati wa kustaafu inawalinda wastaafu kutokana na mahitaji ya mtiririko wa fedha mkononi-mahitaji ya mapato au fedha mkononi kwa ajili ya kuitumia kwa kulipia kodi ya nyumba inakuwa tayari imeshapungua.

Pamoja na hayo tena inawalinda wastaafu kutokana na maamuzi mabaya ya uwekezaji, na faida mbaya inayotokana na uwekezaji ikiwemo na mfumuko wa bei ambao hauendi na ukali wa maisha wa wakati huo. Vile vile inamwandaa mstaafu na maisha yenye heshima usoni mwa jamii na yenye utu mzuri wa hali ya maisha. Umilikaji wa nyumbani kwa kweli huchangia kiasi kikubwa kwa wastaafu kwa ajili ya kuwaandaa maisha ya ulimwengu wa kustaafu na katika kuwatengenezea staili ya miaka yao ya mwanzoni kabla hawajastaafu.

Kuna haja kubwa kabisa msimamizi na mdhibiti wa mifuko ya pensheni ya hifadhi ya jamii yaani (SSRA) kubuni mikakati ya kuhamasisha uhitaji wa nyumba ili kuwezesha wanachama wa mifuko hii ya hifadhi ya jamii kununua nyumba za gharama nafuu. Kwa mfano Singapore wanachama wa hifadhi ya jamii wanaruhusiwa kutumia asilimia 75 ya akiba yao ya michango ya pensheni kwa ajili kukopeshewa nyumba au kwa ajili ya kununulia nyumba maalumu anayohitaji.

Wakati Mauritius na Africa kusini mifuko ya pensheni ya hifadhi za jamii kama vile Shirika la Taifa la Hifadhi ya Jamii (NSSF), Shirika la Pensheni kwa ajili ya Mashirika ya Umma (PPF), Mfuko wa Pensheni wa Hifadhi ya jamii kwa ajili ya Watumishi wa Umma (PSPF) na Mfuko wa Akiba ya Wafanyakazi wa Serikali (GEPF), Mfuko wa Bima wa Taifa yaani (NHIF), mfuko wa pensheni ya Hifadhi ya jamii kwa ajili ya Wafanyakazi wa Serikali za Mitaa yaani (LAPF). Pamoja na Mfuko wa Taifa wa Hifadhi ya Jamii wa Zanzibar (ZSSF) yanaruhusu kutoa mikopo moja kwa moja kwa wanachama na hata vilevile wanachama wa mifuko ya pensheni ya hifadhi ya jamii kutumia sehemu ya theruthi mbili (2/3) ya mafao yao ya baadaye kama amana ya kumpatia mikopo benki na kupata mkopo wa nyumba kutoka taasisi za nyumba au mashirika ya nyumba ya nchi hizo kama vile Shirika la Nyumba la Taifa (THC) la Tanzania.

Na mafao yaliyosalia yanaachwa kama yalivyo bila kuguswa mpaka wanachama atakapofikia wakati wa kustaafu kwa hiyari au kwa lazima. Wanachama waliokopa wanalipa riba kwa muda wote na kuhurusiwa kuingilia mafao kulipa deni halisi alilokopa wakati utakapofika muda wake wa kawaida wa kustaafu. Kwa Afrika kusini viongozi wa hifadhi ya jamii wanapandisha mkopo wa nyumba kwa kutumia soko la mtaji kwa kutoa amana ya pensheni ili kumwezesha mwanachama wa hifadhi ya jamii kumiliki nyumba

Tanzania hairuhusu wanachama wa mifuko ya pensheni ya hifadhi ya jamii kuingilia michango yao ya akiba ya pensheni kwa ajili amana ya kujipatia nyumba ya mkopo. Kwa maana hiyo kuna baadhi ya taasisi au mashirika ambayo yafanya kuwa siyo ya ushindani hasa pale yanapokuja na masharti magumu yanayofanya kwa mtu asisitahili kabisa kupata nyumba ya mkopo. Pamoja na hayo idadi kubwa ya wanachama wa mifuko hii ya hifadhi ya jamii wanakopo kutoka katika taasisi hizo bado idadi kubwa ya wanachama mpaka sasa hawafikiwi. Wakati njia ya kutumia akiba ya michango ya pensheni ambayo huchangiwa na mwanachama na mwajiri wake ilikuwa ndiyo njia pekee ya mbadala ya kumwezesha mwanachama kupata mkopo wa nyumba. 

Katika kutambua umuhimu wa ungezeko wa uzalishaji nyumba kwa ajili ya kuhudumia watu wanaongezeka kila siku, serikali mara kwa mara  imekuwa ikiaangalia uwezekano wa kuwa na ufumbuzi  wa aina mbalimbali na hata vilevile kushawishi ushiriki wa sekta za watu binafsi ili kufikia lengo hili la nyumba. Uwezekano wa kupata mikopo ya fedha kwa waendelezaji na wanunuzi kumekuwa ni mojawapo ya sababu zilizochangia kuwa na uhaba wa nyumba.

Baada ya kutambua kwa thamani ya uchumi ya sekta hii muhimu ya pensheni ya hifadhi ya jamii iliyokuwa nayo mpaka sasa, mwaka 2008 serikali iliunda chombo cha kusimamia na kuthibiti mifumo hii ya hifadhi ya jamii. Muda umefika sasa kwa serikali kuchukua maamuzi ya makusudi ya kuchukulia sekta hii ya hifadhi ya jamii kama chombo ambacho  kinachoweza kuwa na mchango mkubwa wa kutoa mikopo kwa ajili sekta

ya nyumba

Chombo cha kusimamia na kuthibiti sekta ya pensheni ya hifadhi ya jamii yaani SSRA kimetoa miongozo ya uwekezaji pamoja na kuruhusiwa mifuko ya pensheni ya hifadhi ya jamii kujihusisha na uwekezaji wa rasilimali pamoja na nyumba/makazi mpaka kikomo cha asilimia 30% ya jumla ya fedha zote za mfuko. Na mifuko inaweza kujenga au kununua rasilimali isiyohamishika. Isipokuwa  michango au mafao ya pensheni haiwezi kutolewa kwa ajili ya kumwezesha mwanachama kupat mikopo ya nyumba au haiwezi kutumika kama amana ya kupata nyumba ya mkopo au dhamana ya kupata mkopo wa nyumba kwa ajili ya faida au manufaa ya mwanachama wa mfuko wa hifadhi ya jamii

Chinese Contractor Wins Historic Shs222bn NSSF Towers Project

Chinese Contractor Wins Historic Shs222bn NSSF Towers Project
By Our Reporter:

China Civil Engineering Construction Corporation (CCECC) has beaten two other Chinese companies to the lucrative multi-billion tender to complete the long awaited Pension Towers.
CCECC who tendered to construct the intelligent building at Shs222.3 billion, beat China National Aero-Technology International Engineering Corporation (CATIC) and Sino-Hydro Corporation hands down to the mega-deal- the biggest in the commercial real
estate sector.

According to a best evaluated bidder notice, pinned on the NSSF Notice board, the other two firms failed on various aspects of work methods and proposed staff qualifications.
20 companies fromUganda, Kenya, Switzerland, South Africa and China were in the race for the big-ticket project, but only three Chinese companies were picked for the final phase.
Roko Construction that constructed the first phase of the project and the name behind a number of big-ticket projects in Kampala did not make it to the final round.
Tight Race

According to reliable information obtained by The Red Pepper, even though CCECC price of Shs222.3 billion was slightly higher than that of the other two competitors, CCECC who has a rich construction experience on the African continent emerged victorious because “their bid showed that they knew what they were doing.”

The source intimated to us that in a probable haste to cut down costs, the other two bidders had opted to use less qualified people and rudimentary work methods and in some case proposing unrealistically low timelines.
For example CATIC proposed to use grade 25 reinforced concrete instead of the required grade 35 reinforced concrete. The company also proposed to use rudimentary means of mixing and transporting concrete such as wheel barrows and buckets, instead of
the required mixer trucks and cranes.
SinoHydro Corporation on the other hand failed on work methodology. For example, the firm proposed to do curtain walling before the completion of the main concrete frame on which the curtain walling sits. The firm also proposed to fix electrical installation after completion of structural works yet the two are supposed to be carried out concurrently.
Record breaking
Construction of the first phase of Pension Towers which involved construction of four basement levels and some elements of ground and mezzanine floors, started in April 2008  and was completed in January 2012, This phase cost Shs42.5 billion.

Once complete, Pension Towers will be an ultra-modern ‘intelligent’ tri-tower complex. The Central tower comprises of 25 floors while the other two side towers are each ten storeys.
The three towers sit on four basement Floors, one ground floor, one mezzanine floor and one podium floor, making a total of 32 Floors for the taller tower and 17 floors for the short towers, ultimately making the building the biggest and tallest in Kampala.

The building whose surface area is 75,000 m² has 20,000 m2 of net office area. Net parking area is 10,000 square metres and can accommodate up to 500 cars.
The building is said to be bigger than Workers House, Communications House and Crested Towers combined.

Once completed, the building which has been redesigned twice, will have costs Shs264.8 billion shillings, again making it the most
expensive and biggest building structure in modern times.
The building whose cost was originally Shs36 billion had its price increased to Shs120 billion by the NSSF board in 2008. Following

NSSF’s acquisition of an adjacent plot on Nakasero Road, the project was again redesigned to include the newly acquired plot, pushing the cost to the current Shs264.8 billion.
At an earlier press conference to reveal the new design, Richard Byarugaba, NSSF Managing defended the new design as being commercially viable.
“The current redesign will enable us to optimally utilise all the land and ensure that the property earns a good return for contributors.

We anticipate an annual return of 15%,” he said.
Pension Towers is one of the projects under the Fund’s Real Estate Investments portfolio.
Other real estate projects in the pipeline include a 5000 unit affordable residential housing estate in Temangalo and a 3000 unit estate for high income earners in Lubowa.
Experts have also defended the project saying that it will bridge the supply gap in the sky-high priced commercial rent sector.
Renowned architect William Henry Ssentoogo, a Senior Partner with Ssentoogo&Partners said thatthe building would significantly “bring rental costs as well asaddress the supply gap.”
Then board chairman, Mr Vincent Ssekoono, said that increased demand for modern office space in the city centre meant that the fund would make more returns.

Low cost housing remains a dream

By David Ssempijja 

Publish Date: Dec 08, 2012

newvision

 

With a housing deficit of 1.6 million units, coupled with an annual population growth rate estimated at 3.4%, and a 5.6% urbanisation rate, Uganda needs to move swiftly to match her population explosion with decent and affordable shelter.

 

According to the housing ministry, out of the total deficit, 1.29 million is in rural areas and 211,000 in urban centres. The problem is even more worrying given that Uganda’s population is estimated to hit 42 million by 2020, where more eight million affordable housing units will be required to address the deficit.

 

This is being exacerbated by commercial developers building only super luxurious houses.

According to Daniel Opio, the business development manager at Shelter Consult Uganda, the country suffers from lack of affordable housing units that can be acquired by the majority of the population.

 

“Some people build personal houses for more than two years because the finances required outstrip their capacities. This is time-consuming and detrimental to the efforts to close the deficit,” Opio said. 

 

Much as affordability is relative, in Uganda’s context, a low cost house is usually one-bedroomed, established on 11 decimals and selling between sh45m and 50m, going by the standards of private developers of housing estates. 

 

Anatoli Kamugisha, the president of the Uganda Private Property Developers Association, says developing an affordable housing sector for Uganda remains a dream because of the skyrocketing costs of land, building materials and bank loans.

“Even the house cost range we consider to be within the low-cost bracket is not affordable in reality, as far as low income Ugandans are concerned,” he says.

 

He adds the developers are less attracted to dealing in low cost houses because they command less returns on investment.

 

Kamugisha says making low cost housing a reality requires a public-private-partnership arrangement, where there is a cost sharing with a company and other parties like the Government.

For example, the Government can finance road construction, extension of electricity and water to bring down the final cost of the houses.

 

“When President Yoweri Museveni’s request to extend social amenities to Akright Kakungulu Estate was effected, it pushed down the cost of houses by 30%. This also happened when Akright handled a project in Jinja and the municipal council provided the firm with the social amenities” he said.

 

However, Kiganda Ssonko, an independent real estate broker, advises those intending to buy houses but find them expensive to consider buying land and building for themselves.

 

“Purchasing land and building will save you money. For example, one can buy 11 decimals at sh10m and complete a three-bedroom house using not more sh40m on the outskirts of Kampala,” he says. Ssonko adds that direct purchase of low cost houses from developers is suitable for people with too little time to monitor the purchase of construction materials and overseeing the construction process. 

 

The minister for Lands, Housing and Urban Development, Daudi Migereko says the Government, supports new technology for low cost housing units. 

 

He told participants in a recent African Ministers for Housing and Urban Development Bureau meeting in Kampala that Uganda is looking for affordable construction technology to enable more people have access to cheap but modern shelter.

 

Migereko’s revelations came in the wake of a call by Soita Shitanda, the Kenyan minister of housing, advising EAC countries to consider using newer technologies to bridge the increasing deficit of housing units.

 

In Uganda, developers are still stuck with the costly brick, blocks and motar technology, yet some cost sensitive countries are switching to technologies like building panels that lower the costs by up to 30% and builders can put up an affordable three bed-roomed house within a week.

 

The housing sector is also suffering the burden of higher interest rates on mortgages currently oscillating between 25% and 26% per year.

 

“We are optimistic that the rates will come down with the Central Bank’s prudent monetary instruments, because the rates once hit 30%, but we can see them going down further. We remain hopeful of a better future,” the KCB Uganda managing director, Albert Odong, said in a recent interview. 

Lack of a National Physical Master Plan

 

Kamugisha said the absence of a strictly-adhered-to National Physical Master Plan is also serving as a detriment to the country’s housing sector.

 

“The country’s housing sector is struggling because we have no plan to follow in terms of what housing establishments must be built where, why, how, when and by whom. Master plans are helping countries like Rwanda to nurture a sector that has enabled citizens to have organised settlements,” he says. Taking Kampala and its surroundings as an example, only 10% is planned, according to the industry experts.  

 

Well-planned settlements are some sections of Kololo, Mbuya, Bugolobi, Ntinda, as well as a few housing estates established by private developers such as Akright Housing Estates, National Housing and Kensigton.