How Can You Safely Buy a House in Uganda from Abroad?

Sunday, September 12, 2010
By ugandansabroad


By Rebecca Harshbarger–

Many Ugandans living in the U.S., Canada and U.K. have been scammed or cheated trying to use their salaries from jobs abroad to construct property on their land in Kampala.

Some have reported arriving home to find nothing constructed on their property, and the money gone. Others have sent large sums of money only to find half-constructed homes made of poor-quality material.

To prevent that from happening in the future, the National Housing and Construction Company (NHCC) and the Housing Finance Bank held a workshop at New York’s Uganda House last week to teach members of the diaspora how to purchase homes securely. The two Kampala-based companies sent representatives to New York after the UNAA Convention earlier this month in Washington, D.C. More than 50 members of the diaspora attended the event.

A real estate development in Lubowa.

Caleb M. Kakuyo, the chief commercial officer for NHCC, showed the audience from New York and New Jersey a slideshow of properties for sale, as well as real estate projects being constructed right now.  Kakuyo showed properties in Naalya, Kiwatule, and Kyambogo, among others.

He also announced that 68 apartments would be constructed in Mbarara in 2011, after audience members were concerned over the lack of real estate properties being shown outside of Kampala.

Patrick Kabonero, the executive director of development finance for the Housing Finance Bank, said the bank was trying to be more accommodating to the international Ugandan community.  ”We know the diaspora has money and is sending it here,” he said.  ”We want the diaspora to invest their money properly.”

For example, Housing Finance Bank now offers loans in dollars and pound sterling with lower interest rates than loans made in shillings.  Both Kakuyo and Kabonera said they hoped to expand and introduce representatives from both companies to the U.S. to make it easier and more secure for the diaspora to buy real estate back home.

NHCC's flats in Bugolobi.

The properties shown ranged from $60,000 to more than $300,000.  Most included a central septic system, electricity, paved roads, and amenities such as nurseries, parking, easy access to shopping centers, and more.

For example, in the Lubowa 80 real estate development along Entebbe Road, apartments have access to a commercial space, nursery school and club house.

Those interested in the properties can take out a mortgage on real estate if they deposit 10 percent of the home’s cost.  The monthly repayment cannot exceed more than 35 percent of  your monthly income.

Borrowers can take up to twenty years to repay on residential properties, and ten years for commercial properties.  Five-year mortgages are available for urban plots.

Borrowers must repay the principal, interest and the insurance premium, as well as fees for the valuation of property and the mortgage application.

The question and answer session lasted for several hours, with concerns expressed over the lack of price listings on the NHCC website, an absence of upcountry properties in the presentation, and the need to have full-time representatives from both companies in the U.S.

NHCC is one of Uganda’s oldest companies, forming as a government parastatal in 1964.  Today, it is a publicly-owned company, with government holding 51 percent of its shares.  The Libyan government owns 49% of National Housing’s shares, worth an estimated $21.1 million.  The money has been used to build housing estabes in Lubowa and Naalya.

The Housing Finance Bank became a commercial bank in 2007, and currently has 60 percent of the market share in mortgage financial instruments in Uganda.

Those in the diaspora interested in purchasing a house can visit the National Housing website to view properties here.  If you have questions, you can e-mail Mr. Kakuyo at ckakuyo@nhcc.co.ug.  If you find a property you are interested in, you can follow-up on the Housing Finance Bank’s website here.  Those with concerns or inquiries can get in touch with Mr. Kabonero at kabonerop@housingfinance.co.ug.

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