The coming on board of the National Building Society (NBS) will help those at the lower end of the market to own houses, analysts have projected.
BY BUSINESS REPORTER
A local analyst said NBS had come in with competitive rates, although there has been a decline in interest rates to 14%.
“This will help those at the lower end of the market to have an opportunity to own houses ,as the rates are favourable,” the analyst said.
The analyst said the building society has opened its doors at the appropriate time, where there are sluggish interest rates and most likely there was going to be deposit shifts from banks that have been offering mortgages, as depositors would be looking for low interest rates on loans.
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Zimbabwe Teachers Union president, Richard Gundani said the development was good, as there was need to provide houses for civil servants, as there has not been any salary increment for a long time.
“This scheme should help the workers get houses,” he said.
At the launch of the institution, NBS said a third of the loans would go to civil servants.
Zimbabwe Congress of Trade Unions (ZCTU) secretary-general, Japhet Moyo, said employee organisations were not invited to the NBS launch.
“We have written officially to the Ministry of Labour that we want to be part of the NSSA board, but there has not been any communication from the ministry,” he said.
ZCTU is the largest body representing workers.
The building society says it will offer mortgages at an interest rate of 9,5% per annum, with a tenure of 25 years.
The market has been experiencing interest rates of 14% and the single digit interest rate is likely to reduce interest rates in the mortgages market, according to analysts.
NBS was given a certificate of registration in December 2015, by the central bank. In April, NSSA completed the $25 million capitalisation process. The country has a housing backlog of 1,25 million and government is targeting to build 300 000 houses by 2018.
NBS seeks to build 2 000 houses on an annual basis and will begin with its housing projects in Glaudina, Harare and Bulawayo for low income earners.
NBS was launched on Wednesday and is a unit of the National Social Security Authority.