WITH an estimated 1,2 million people on the government’s national housing waiting list, demand for land in urban centres such as Harare and Bulawayo is on the rise and owning a house has remained a pipedream for many low income earners.
Mernat Mafirakurewa
A local company, Vantage Affordable Housing, yesterday unveiled the Build One Room At A Time concept to enable low income earners to build homes. Below are excerpts of an interview between NewsDay News Editor Mernat Mafirakurewa (ND) and Vantage Holding general manager Rachel Karira (RK).
ND: Can you give us a brief background of Vantage Affordable Housing? RK: Vantage Affordable Housing is a subsidiary of Vantage Holdings and is dedicated to providing housing financing solutions for the economically marginalised communities in Zimbabwe.
ND: What has motivated you to launch the building material credit facility? RK: In recent years, there has been an upsurge of urban dwellers resulting from the increase in rural-urban migration. The increase in urban population also increases the demand for schools, healthcare facilities, sanition, sewer, transportation etc.
The government cannot cope with this burden on its own. Hence, we have partnered with United Merchants Builders in providing credit for low cost houses in a Build One Room At A Time concept. This takes the focus off government subsidies for building houses and allows individuals and groups to build their houses without government assistance.
ND: What is your target market? RK: Primarily, our target market is low income earners and informal traders. However, we are pursuing the possibilities of availing this financial service to civil servants and other individuals with medium income. Anyone who earns below the poverty datum line of $550 is welcome.
ND: Can you explain how the concept of the building materials credit facility operates? RK: The Building Materials Facility works on a Build One Room At A Time concept. It works with both individuals and groups and we say build one room at a time. In groups, our clients take turns to build houses for each other. They will have a revolving fund (a round) in which they contribute on a monthly basis and then have building materials delivered to their members in batches until everyone in the group has built at least one room.
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Individuals also make contributions of up to half of the value of the building materials required for the structure. After a minimum period of at least four months, all the building materials required for the building are then delivered to the sight of the building.
ND: Whom have you partnered with in terms of suppliers of building materials? RK: We have partnered with United Merchant Builders, which has a good branch network nationwide. We also have established relationships with suppliers in various locations where we have clients e.g. bricklayers and riversand suppliers. This was driven by our objective to support the communities in which we operate.
ND: How many people do you want to assist? RK: We want to reach out to anyone who is facing challenges with building a house, obviously giving priority to our main market which is low income earners and any other less privileged Zimbabweans.
ND: Given the tight liquidity obtaining on the market. What measures have you put in place to ensure that beneficiaries pay-up? RK: With the structured groups like, the group itself becomes liable in case of default. With individuals, we do not demand the lump sum of cash required upfront. We encourage our customers to pay little by little, as they get money. This makes the total bill seem lighter and more bearable for our clients.
ND: Do you have any plans of rolling out the facility to other cities such as Bulawayo? If so, how soon are you likely to do so? RK: Our facility can be accessed by any persons in any location in Zimbabwe.
ND: What other services does Vantage Holdings offer? RK: We have a partnership with a development company named Nyavira Development company. In this partnership, we give credit for land acquisition. Once our clients have paid for a percentage of the total acquisition price, they will then qualify for the Building Materials Credit Facility. Our sister company Vantage Micro-Finance also gives loans for business. Another sister company, Vantage Micro-Enterprise, empowers people with home industry skills that can help them to generate income. We train people to make floor polish, dishwashing liquid, engine cleaner, carpet cleaner, cool drinks and hair shampoo.
ND: What are your future plans? RK: In the near future, Vantage Holdings will be adding to its array of products, long and short-term micro-insurance, that is healthcare, life insurance and asset cover.
