THE Estate Agents’ Council (EAC )says cheap imports from neighbouring countries were affecting its business as clients are forced to close down businesses or relocate to other places due to intense competition.
Oswald Nyakunika, the EAC chairperson and a managing partner at Knight Frank, told Southern Eye Business that the liquidity crunch had adversely affected their business.
“We are undergoing deindustrialisation because of serious competition from cheap imports. All manufactured goods are coming in as literally cheap compared to goods manufactured in the country hence affecting our members in the property investment. Those who are leasing those properties end up closing down businesses,” Nyakunika said.
“We need to replace our ageing plant and machinery and cut costs. It will cost money to recapitalise and there is need to sleep in bed with foreign investors. We therefore need to come up with policies that are conducive to investment in order to attract foreign investors,” he added.
Nyakunika said businesses were finding it hard to pay rentals and there were no mortgage funds for those who wanted to buy properties.
He said it was therefore difficult to sell and find quality tenants.
He said even though many sellers were accepting deed of sale (payment by instalments) arrangements, they still needed new developments.
He encouraged people to invest in property even though it is currently undergoing tough times.
“It is a safe investment. During the hyperinflation era, only those who had invested in property survived. Everybody lost their money. All savings were wiped out and shares/equity reduced to nothing. The sector is heavily geared and there are a number of properties being auctioned. If you have the cash you can buy properties at these auctions at reasonable prices. Prices for building materials are becoming reasonable,” he said.
Nyakunika hoped the economy would improve, but said the government should come up with policies that liberalise the economy and encourage foreign investment.
He described 2014 as a very difficult year in which a number of businesses collapsed.