HARARE City Council is likely to offer its properties to sitting tenants at hugely discounted prices of up to 50 percent of the market value as it seeks to comply with a government directive.Last month, Local Government, Public Works and National Housing Minister, Ignatius Chombo, instructed council to dispose of its houses to sitting tenants in the national interest.
The directive, issued while Chombo was in the thick of campaigning for ZANU-PF candidates in the upcoming by-elections, is the latest in a series of populist policies by the ruling administration that have plunged council into financial quagmire.
Towards the 2013 elections, councils across the country were directed by government to write-off amounts that were owed by residents in rates from 2009. The directive was extended to power utility, ZESA Holdings, which was made to cancel a portion of household bills that were outstanding.
While this came as good news to residents, the directive left councils financially hamstrung. They are yet to recover. Similarly, many fear that council would be left worse off after disposing of its properties to sitting tenants for a song.
Minutes of the housing, health, education and community services committee meeting held recently, indicate that council would soon be implementing Chombo’s latest directive.
This means the local authority would be selling the houses at a loss considering the amount of money it is letting go off as discount.
Chombo’s instructions were adopted by the full council meeting last Thursday for implementation. The move has been criticised as a gimmick to win voters for the ruling ZANU-PF party, in which Chombo is the fourth highest ranking official as the party’s secretary for administration.
What has raised eyebrows is the fact that the move comes at a time when council is in dire need of money to run its affairs. The city is struggling to provide basic services to residents due to serious budgetary constraints.
In its deliberations, the committee accepted the order after realising that council was collecting measly revenue from rentals and would benefit more from selling the housing units than keeping them.
This was also done to ensure that the city gets a facelift, especially given that most of council houses have remained unimproved for decades.
In encouraging councillors to adopt the move, Harare deputy mayor, Thomas Muzuva, said they had carried a survey and realised that the ugliest of houses in many suburbs across the city belonged to the local authority.
The biggest beneficiaries would be those who have occupied the houses for 20 years or more who shall assume ownership of the properties at prices ranging between 40 and 50 percent of their market value.
This means an average high density suburb house, selling at US$30 000, will be sold at half the price, payable over five years. The offer shall be available to sitting tenants who are up to date with municipal bills for rentals, water and other charges at the time they exercise the option.
The committee agreed that where a sitting tenant fails or refuses to exercise the option to purchase, the housing unit shall remain council rented accommodation.
This will, however, exclude all institutional accommodation that include housing units at work stations as well as all hostels and flats.
Also excluded from the sale are farms, swimming pools and apartments at Harare’s Trafalgar Court.
Council intends to set aside 50 percent of the total sale price of the disposed houses to rebuild its dwindling social housing stock.
“The money shall be ring-fenced in a separate bank account. The implementation of the offer will be staggered, starting with properties in high density areas while properties in the medium and low density areas would be implemented subsequently after an assessment of the initial process,” reads part of the minutes. financial gazette NEWS
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