Financing a home in Harare, Bulawayo or elsewhere in Zimbabwe
In Zimbabwe, a home loan comes mainly from building societies such as CABS, banks like CBZ or FBC and the National Building Society, usually in US dollars, provided you have a titled property, a deposit and an income that can be verified.
Mortgage lenders on the Zimbabwean market
CABS, an Old Mutual subsidiary, has long been a major housing lender. CBZ Bank, FBC Building Society, ZB Building Society and the National Building Society, owned by NSSA, also grant mortgages, as does Stanbic Bank Zimbabwe for a clientele of executives.
Why mortgages are mostly in US dollars
A loan spread over many years needs a stable currency, something the country has rarely enjoyed since the 2008 hyperinflation. Building societies therefore lend mostly in US dollars and require borrowers to earn income in that currency themselves.
The title deed, an almost unavoidable condition
The bank registers a mortgage, known as a mortgage bond, at the Deeds Registry against the title deed. Plots sold through a simple cession or an agreement of sale, common in the Harare extensions, generally cannot support this kind of loan.
Beware of land barons
Illegal land developers, nicknamed land barons, have sold plots on state land or without an approved layout in Caledonia, Epworth or Chitungwiza. Checking the survey diagram with the council and the Surveyor-General avoids buying land the bank will reject.
Deposit, loan-to-value and affordability
Zimbabwean lenders rarely finance the full price and ask for a deposit whose percentage depends on the property and the profile. They also cap the instalment at a share of net income, taking into account loans already deducted from the salary.
Building on a council stand
Many households buy a stand from the council or a developer, then build in phases. Some building societies fund construction in tranches released after inspection, provided the plans are approved by the city council of Harare, Bulawayo or Gweru.
Diaspora buyers and income earned abroad
Zimbabweans living in South Africa or the United Kingdom fund a large share of residential building. Some banks run dollar diaspora schemes; to compare with the neighbouring market, see our guide to the mortgage in South Africa.
Transfer and registration costs
On top of the price, the buyer pays the conveyancer, the lawyer handling the transfer, Deeds Registry fees and stamp duty, plus registration of the bond. These costs come on top of the deposit and are generally not covered by the loan.
Civil servant housing and public schemes
The Ministry of National Housing has launched several housing projects, and public employers negotiate schemes with building societies. These programmes face long delays, so applicants must register on municipal waiting lists and follow official announcements closely.
Insurance required by the building society
The borrower takes out life cover for the outstanding balance and home insurance against fire, often with a partner insurer. The lender remains the beneficiary of these policies until full repayment and cancellation of the mortgage bond at the Deeds Registry.
Buying a home as retirement approaches
A borrower nearing the end of their career gets a shorter term, because lenders want the loan cleared before the salary stops. Our guide to the loan for retirees in Zimbabwe describes the options available after that point.
Placing home finance within Zimbabwean credit
Weighing renting against buying, families in Harare and Bulawayo often compare a dollar rent with a loan instalment. To see where this financing sits among other forms of borrowing, the overview of loans in Zimbabwe presents the players and rules.
Buying a home with a loan in Zimbabwe
- Have the property title checked at the Deeds Registry and confirm no bond or attachment is registered against it.
- Get a pre-assessment of your borrowing capacity from the building society based on your dollar or ZiG income.
- Sign an agreement of sale conditional on loan approval, drafted or reviewed by a conveyancer.
- Let the bank appoint a valuer to assess the property in Harare, Bulawayo or the town concerned.
- Receive the offer letter, take out the insurance and pay the deposit along with transfer costs.
- Wait for simultaneous registration of the transfer and the mortgage bond at the Deeds Registry before the seller is paid.
Budget for a property purchase in Zimbabwe
| Expense | Basis of calculation | Remark |
|---|---|---|
| Personal deposit | Share of the price not financed | Percentage varies by lender and property |
| Conveyancer fees | Professional tariff and property price | Paid at transfer |
| Transfer stamp duty | Price or value of the property | Sliding scale set by law, indicative |
| Mortgage bond registration | Bond amount | Includes Deeds Registry fees |
| Life and fire insurance | Loan balance and rebuilding value | Monthly premiums |
Mortgage file for a building society
- National ID card and marriage certificate where applicable
- Recent payslips and an employer letter stating the salary currency
- Six months of bank statements
- Copy of the title deed and signed agreement of sale
- Council-approved plans for a construction project
- Seller's up-to-date council rates clearance certificate
Pitfalls of a home loan in Zimbabwe
- Paying a deposit to a land baron for a plot with no title or approved layout, which the building society will later refuse to fund.
- Overlooking the seller's rates clearance certificate, without which the transfer can be held up at the Deeds Registry.
- Presenting a ZiG income for a dollar loan without showing foreign-currency earnings, a frequent reason for rejection.
- Underestimating conveyancer fees, stamp duty and registration, which come on top of the required deposit.
- Starting construction before the council approves the plans, which rules out phased financing.
Key points on Zimbabwean home loans
Can you get a mortgage in ZiG in Zimbabwe?
Some banks consider local-currency financing, but most of the mortgage market runs in US dollars. Lenders match the loan currency to the currency of your income and apply different rates and terms depending on which currency is chosen.
Can land sold through a simple cession serve as security?
Generally not, because the mortgage bond must be registered at the Deeds Registry against a title deed. Land allocated in unregularised projects is a problem, so you must wait for the title to be issued or choose another property.
Who chooses the conveyancer in a financed purchase in Zimbabwe?
The seller usually appoints the transfer lawyer, while the bank instructs its own conveyancer to register the bond. The buyer normally pays these fees and should include them in the budget from the moment the agreement is signed.
Can Zimbabweans in the diaspora borrow for a home?
Several banks and building societies accept diaspora applications, with proof of foreign income and often a larger deposit. A representative on the ground holding a power of attorney makes dealings with the conveyancer and the council much easier.