Stop foreigners from buying property, says BoN

GOVERNMENT should put in place a moratorium on the purchase of land by non-Namibians, Ebson Uanguta, the director of research at the Bank of Namibia (BoN), has said.

Speaking at the BoN’s 13th annual symposium on Thursday, Uanguta said the moratorium should stay in place until such a point that the current housing backlog is sufficiently addressed.Foreign cash buyers buying houses locally have contributed to the increase in house prices, he said.Uanguta said by 2007 the housing backlog was estimated to be standing at 80 000 households and indications are that this figure has since increased.He said 70 per cent of Namibia’s population cannot access decent residential properties mainly due to issues of affordability.’With a backlog of 80 000, the situation is dire and needs radical policy measures to address it,’ he said.Uanguta added that high-income earners buying residential properties for investment purposes is another contributing factor to the increase in house prices.Such speculative buyers were lured to the market by the sustained appreciation of house prices over the years, which guarantees a positive return from such an investment, he added.Uanguta said these massive investments for gain have been partly contributing to the steep rise in house prices.Furthermore, the monthly income accruing for investors in the form of rent has also increased over the years, he said.Uanguta said other factors include the various procedures applicable in the process of acquiring a property in Namibia, auctions and valuators who are tasked with determining the worth of an already standing structure and the increase in the costs of building materials.He recommended that central government boost land supply by boosting the financial support to the local authorities and the National Housing Enterprise (NHE) to enhance their capacity to purchase and service land across the country.He also recommended that a review of the land acquisition and registration process needs to be conducted in order to streamline these processes for timely land delivery.Uanguta said since financial constraints are the main factor hindering the NHE from accelerating the country’s housing supply, a portion of the pension funds and contractual savings that the country has in excess can be channeled into housing investments through NHE.He said auctioning of land for extraordinary gains should be prohibited as this leads to inflated prices, adding that alternatively, it should be limited to high-income residential areas.The offer-to-purchase procedure recently adopted for first-time buyers is a step in the right direction, Uanguta said. – Nampa

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