Dawn Property Consultancy Private Limited managing director John Ndere says they are noticing increased Zimbabwe Gold (ZiG) transactions in real estate sector despite the industry being forex-driven.
For months, the real estate sector has been negatively affected by declining mortgage opportunities and increased rental voids as prices rose in tandem with inflation.
Ndere told NewsDay Business the introduction of ZiG has brought stability and confidence in the property sector.
“The introduction of the ZiG currency in April 2024 has brought some much-needed stability to the real estate industry, which requires investors with a long-term view,” he said.
“As confidence in the ZiG grows, we are seeing more buyers and sellers transacting using the new currency. Property investors are gaining confidence in the ZiG, indicating that it is being accepted as a medium of exchange.”
He said Dawn supported the government’s effort to promote the use of the local currency in transactions.
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“The authorities are working to ensure that the ZiG is recognised internationally as Zimbabwe’s new currency. Once the global community embraces the ZiG, it will further boost confidence at the local level and lead to wider adoption,” Ndere said.
“While introducing a new currency can initially be met with scepticism, the experience of other African countries such as Zambia and Mozambique shows that it is possible to instil confidence in a domestic currency. Given that it is unsustainable for an economy to operate without its own currency, it is important for all Zimbabweans to support the transition to the ZiG and embrace its use.”
Despite the increased usage of ZiG, the Dawn boss did not rule out the fact that the US dollar remained the preferred currency in real estate.
“As a real estate company operating in a multi-currency environment, Dawn Property Consultancy has not faced challenges with the shortage of the US dollars. Since the company does not engage in trade that would require making payments in US$, it is able to pay its suppliers in the local ZiG currency,” Ndere said.
“For those suppliers who do require payment in US dollars, the company is able to accommodate this by using the US dollars it receives from clients who pay in that currency. This allows Dawn Property Consultancy to maintain a balance between receiving US dollar payments and making US dollar payments as needed.”
He said the company had been able to navigate the multi-currency system without significant issues related to access to US dollars.
“The business model of paying local suppliers in the ZiG currency, while retaining the ability to pay in US dollars for specific requirements, has helped Dawn navigates the US dollar shortages that have affected some other sectors,” Ndere said.
In the outlook, Dawn sees the introduction of the ZiG currency, increasing construction activity, addressing the serviced land shortage and the regulator’s action against bogus realtors as key steps in growing the sector.