Investing in Africa

The property market in Africa is turning out to be a safe haven for investors in Africa. Rentals have for the past few years been going up quite steadily and as a result the property market has turned out to be one of the safest and profitable areas in the African continent. Property is getting good returns so much that unit trusts that are composed of almost entirely property investments have turned out to be the best performing ones.

Rentals have been steadily going up and the value of buildings have been going up as well. Rentals in the country I live in, Zimbabwe, went up as high as 25% during the first quarter, a development that has seen shares of property companies improving very well and having unit trusts being created to take advantage of the surge in the area. Property unit trusts are providing up to 10% per month and investors are finding the unit trusts a profitable venture. Across Africa, the same trend has been quite the norm and the same boom has been noticed across all Africa and well performing unit trusts have been created in this respect.

Rentals for properties in the Central Business areas have particularly been the best performing ones, the have increased by at least 10% across almost all of the continent. Whether this has been a result of increased investment or just a general increase, this has led to speculation amongst owners and this has quite distorted the market such that rentals are higher than they were this time last year but quite distorted. Office space has particularly become more expensive and mortgages have become a bit more expensive.

Residential properties have become a bit more expensive and the trend is expected to keep on like that such that many financial advisers have been advising their clients to invest in this safe haven. construction companies should really take advantage of this and maybe get to build more properties.

Again as a reference point from the country I stay in, Zimbabwe, the property market is a bit distorted owing to the fact that there is a liquidity crunch, there is really little money changing hands. This has resulted in property prices not being so high but much money is coming from rentals and for the few who have the privilege of owning properties are making quite a good return on their investments.

The trend is quite the same all over the continent and I believe in the short to medium term, the trend is likely to continue and owning property will be, for a long time, a preferred way of investing with assured good returns.

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