The Housing Finance System

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A. Primary Housing Finance Market

A.1 Industry Structure and Performance
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Number of firms originating and funding mortgage loans  4
 
A.1.1
Types of originating lenders/market share:A.1.2
Universal/ commercial banks  0% of total
Author's Research
A.1.2.1
Other depository institutions (savings and loans/mutual savings and credit institutions)  95% of total
Author's Research
A.1.2.2
Non-depository financial institutions specialized in housing finance  0% of total
Author's Research
A.1.2.3
General non-depository financial institutions  0% of total
Author's Research
A.1.2.4
Others (e.g. insurance co, pension funds, labor tax funds)  5% of total
Author's Research
A.1.2.5
Identify the 3 largest loan originating lendersCABS, CBZ Bank and ZB Building Society Building Societies: CABS, CBZA.1.3
Are there (quasi) public mortgage lenders:YesYesYes
Research
A.1.4
Universal/ commercial banksYesYesYesA.1.4.1
Other depository institutions (savings and loans/mutual savings and credit institutions)YesYesYesA.1.4.2
Non-depository financial institutions specialized in housing financeNoNoNo
Research
A.1.4.3
General non-depository financial institutionsNoNoNo
Research
A.1.4.4
Others (e.g. insurance co, pension funds, labor tax funds)  Yes
Author's Research
A.1.4.5
Level of Non-Performing Mortgage Loans (90 days or more past due):A.1.6
as a % of # of loans  4.24%
Reserve Bank of Zimbabwe
A.1.6.1
Average 1997-2007 A.1.7
A.2 Size of Mortgage Finance Sector
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Total amount of home mortgage loans outstanding at the end of year in millions of USD:346.75 USD (millions)512.88 USD (millions)357.13 USD (millions)A.2.1
Total amount of home mortgage loans outstanding at the end of year as % of GDP (current)2.43%3.61%2.65%
WEO and Central Bank of Zimbabwe
A.2.1.1
and as % of all credits outstanding8.73%13.28%9.62%A.2.1.2
Total amount of home mortgages made in calendar year in millions of USD  146 USD (millions)
Author's Research
A.2.3
and as % of GDP (current)   2%
Author's Research, own calculation
A.2.3.1
Total # of home mortgage originations made in calendar year  3 thousand
Author's research
A.2.4
A.3 Housing Finance Products
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Mortgage products as % of all mortgages (approx.) in local currency:A.3.1
Fixed rate for life of loan  0%
Author's Research
A.3.1.1
Variable rate/indexed  100%
Author's Research
A.3.1.2
Variable rate/discretionary  0%
Author's Research
A.3.1.3
Other fully amortizing loans (e.g. Rollover)  0%
Author's Research
A.3.1.4
Non-fully amoritizing loans (e.g. Price level adjusted/Interest only)   0%
Author's Research
A.3.1.5
Loans based on foreign currency as % of all mortgage products  Non-applicable
 
A.3.2
Most prevalent type of foreign currency mortgage used:A.3.3
Most frequent interest rates on fully amortizing:A.3.4
Typical lender fees associated with mortgage origination: A.3.6
Fixed in amount   25 USD
 
A.3.6.1
Typical third party fees associated with mortgage origination:A.3.7
Appraisal fees  2 USD
Author's Research
A.3.7.1
Title related fees  Not available
Author's Research
A.3.7.2
Legal fees  Not available
Author's Research
A.3.7.3
Search fees  10 USD
Author's Research
A.3.7.4
Loan-to-Value (LTV) on first mortgage: A.3.8
Maximum LTV  85
 
A.3.8.1
Typical LTV at origination  75
 
A.3.8.2
Maximum term over which pmt is calculated?   10 years
 
A.3.9
Mortgage pmt-to-income ratio A.3.10
Maximum pmt-to-income ratio (Individual income)  25%
CBZ
A.3.10.2
Typical pmt-to-income ratio (Individual income)  25%
CBZ
A.3.10.4
A.4 Lending and Servicing Process
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Does the mortgage industry use standard principles/guidelines for underwriting?YesYesYes
Building Society Act
A.4.1
Which institutions define underwriting rules? A.4.2
Central Bank/Ministry of FinanceYesYesYes
Research
A.4.2.1
Secondary market facility  No
Author's Research
A.4.2.2
Major Lender  No
Author's Research
A.4.2.3
Other  Yes
Author's Research
A.4.2.4
Do third party servicing institutions exist?   No
Author's Research
A.4.5
% of loans serviced by originators/lenders  100%
Author's Research
A.4.6
A.5 Credit Risk Assessment
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Do credit bureaus exist? YesYesYesA.5.2
Are there legal/regulatory constraints to gaining access to credit information?  Yes
Author's Research
A.5.2.1
What percentage of mortgage originations use credit scoring?  100%
Author's Research
A.5.1
Is mortgage default insurance available?YesYesYes
Housing Finance Mechanisms in Zimbabwe
A.5.3
When did it begin operating?Since the beginning of the building societiesSince the beginning of the building societiesSince the beginning of the building societies
Housing Finance Mechanisms in Zimbabwe
A.5.3.1
What is the typical MI product?Mortgage Protection Policy (MPP)Mortgage Protection Policy (MPP)Mortgage Protection Policy (MPP)
Housing Finance Mechanisms in Zimbabwe
A.5.3.2
Are credit guarantee systems used?   No
Author's Research
A.5.4
Is there public sponsored MI / guarantee?  No
Author's Research
A.5.5
What % of the market does public MI / guarantee serve?  Non-applicable
Author's Research
A.5.6
What share of total annual mortgage production is insured/guaranteed?   100%
CBZ
A.5.7
B. Funding Sources for Mortgages and the Secondary Mortgage Market
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
What are the main funding sources for mortgages?B.1
Retail funding (deposits/other)primaryprimaryprimary
Research
B.1.1
Wholesale funding: loans from other banks or corporationssecondarysecondarysecondary
Research
B.1.2
Funding through mortgage bonds   Non-applicable
 
B.1.3
Funding through securitization of mortgages  Non-applicable
 
B.1.4
C. Housing Microfinance
VariableEnd of 2015End of 2014End of 2013SourcesVar ID
Are non-collateralized housing micro-finance loans offered?   Yes
ZAMFI
C.1
Types of lenders operating in the housing micro-finance (HMF) sector:C.2
Commercial banks  Yes
Author's Research
C.2.1
Specialized non-depository MFIs   No
Author's Research
C.2.2
NGOs  Yes
Author's Research
C.2.3
Others  Yes
Author's Research
C.2.4
None  No
Author's Research
C.2.5
Level of NPLs (>90 days past due) in HMFC.4
as a % of loans  Not available
 
C.4.1
Are non-collateralized but secured housing finance products offered (e.g. secured by pension or insurance savings)  No
Author's Research
C.5
back to top | Country Data:
Notes: 15 % Value added tax on rental income
Notes: 15 % Value added tax on rental income
Notes: 15 % Value added tax on rental income
Notes: 15 % Value added tax on rental income
Notes: 15 % Value added tax on rental income
Notes: 15 % Value added tax on rental income
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 2010 = 100
Notes: 5-10 years. The shorter tenure in current years is due to liquidity constraints.
Notes: 5-10 years. The shorter tenure in current years is due to liquidity constraints.
Notes: All loans are variable and indexed.
Notes: All loans are variable and indexed.
Notes: All loans are variable and indexed.
Notes: All loans are variable and indexed.
Notes: All mortgage loans acquired prior to the introduction of the multicurrency system , were eliminated due to inflation.
Notes: Also required is a house-owner's comprehensive insurance
Notes: Also required is a house-owner's comprehensive insurance
Notes: Also required is a house-owner's comprehensive insurance
Notes: Also required is a house-owner's comprehensive insurance
Notes: Also required is a house-owner's comprehensive insurance
Notes: Also required is a house-owner's comprehensive insurance
Notes: Approximate
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Approximate value
Notes: Association of Building Societies lobbies both the government through the Ministry of Finance, Ministry of local government, and Ministry of Housing and Social Amenities as well as the Central Bank.
Notes: Building Societies have set a maximum of 75% but can go as low as 50% depending on risk appetite as well as prevailing economic factors.
Notes: Building Societies have set a maximum of 75% but can go as low as 50% depending on risk appetite as well as prevailing economic factors.
Notes: Building Societies have set a maximum of 75% but can go as low as 50% depending on risk appetite as well as prevailing economic factors.
Notes: Building Societies have set a maximum of 75% but can go as low as 50% depending on risk appetite as well as prevailing economic factors.
Notes: Capital gains are treated as income and taxes are levied at the same progressive rates.
Notes: Capital gains are treated as income and taxes are levied at the same progressive rates.
Notes: CBZ offers the CashPlus - Housing Account which is a high interest earning savings account for those with low-income and saving up to buy a home. The client saves for half the price of the home and the Bank matches that amount in the form of a loan.
Notes: CBZ offers the CashPlus - Housing Account which is a high interest earning savings account for those with low-income and saving up to buy a home. The client saves for half the price of the home and the Bank matches that amount in the form of a loan.
Notes: CBZ offers the CashPlus - Housing Account which is a high interest earning savings account for those with low-income and saving up to buy a home. The client saves for half the price of the home and the Bank matches that amount in the form of a loan.
Notes: CBZ offers the CashPlus - Housing Account which is a high interest earning savings account for those with low-income and saving up to buy a home. The client saves for half the price of the home and the Bank matches that amount in the form of a loan.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: CBZ was 100% acquired by the government of Zimbabwe in 1991 due to financial difficulty. The government is no longer the sole owner but it does have the second largest share.
Notes: Employer-assisted housing schemes
Notes: Employer-assisted housing schemes
Notes: Employer-assisted housing schemes
Notes: Employer-assisted housing schemes
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: FCB was formed in 1990.
Notes: If a household size of 4 is assumed
Notes: If a household size of 4 is assumed
Notes: If a household size of 4 is assumed
Notes: If a household size of 4 is assumed
Notes: Informal institutions and building materials suppliers
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Legal constraints pertain to the fixed term advance, where the advance should not be for more than 5 years.
Notes: Lending rates quoted by banks range between 6% and 35% per annum, with most banks quoting average lending rates around 20%
Notes: Lending rates quoted by banks range between 6% and 35% per annum, with most banks quoting average lending rates around 20%
Notes: low density
Notes: low density
Notes: low density
Notes: mandatory
Notes: mandatory
Notes: mandatory
Notes: mandatory
Notes: mandatory
Notes: mandatory
Notes: National housing backlog of 1.25 million , i.e. 5 million citizens or 37% of Zimbabwe's population may live in substandard housing.
Notes: No lending due to inflation.
Notes: on all loans
Notes: on all loans
Notes: Pension funds i.e National Social Security Authority (NSSA), Local Authority Pension Fund, Mining Industry,Communication Allied pension fund, almost all pension funds offer mortgages to their contributors.
Notes: Pension funds i.e National Social Security Authority (NSSA), Local Authority Pension Fund, Mining Industry,Communication Allied pension fund, almost all pension funds offer mortgages to their contributors
Notes: Pension funds i.e National Social Security Authority (NSSA), Local Authority Pension Fund, Mining Industry,Communication Allied pension fund, almost all pension funds offer mortgages to their contributors
Notes: Pension funds include local authority pension funds and mining industry pension funds. Labor tax funds include National Social Security Authority.
Notes: Pension funds include local authority pension funds and mining industry pension funds. Labor tax funds include National Social Security Authority.
Notes: Pension funds include local authority pension funds and mining industry pension funds. Labor tax funds include National Social Security Authority.
Notes: Pension funds include local authority pension funds and mining industry pension funds. Labor tax funds include National Social Security Authority.
Notes: Presently at 20% of the capital gain if transaction was done during the multi-currency regime and 5% of the purchase price if it was done in the Zimbabwean dollar era.
Notes: Presently at 20% of the capital gain if transaction was done during the multi-currency regime and 5% of the purchase price if it was done in the Zimbabwean dollar era.
Notes: Presently at 20% of the capital gain if transaction was done during the multi-currency regime and 5% of the purchase price if it was done in the Zimbabwean dollar era.
Notes: regulated by the central bank
Notes: regulated by the central bank
Notes: regulated by the central bank
Notes: regulated by the central bank
Notes: regulated by the central bank
Notes: regulated by the central bank
Notes: Rental income is considered as income and taxes are levied at standard progressive rates.
Notes: Security- property should be titled
Notes: Security- property should be titled
Notes: Security- property should be titled
Notes: Security- property should be titled
Notes: Security- property should be titled
Notes: Security- property should be titled
Notes: Since resumption of mortgage lending in 2010 to March 2011 the 4 building societies advanced 3000 loans with a value of USD $146 million.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Stamp duty is levied on property transfer.
Notes: Standard sizes range from 150 sq.mt to 500 sq.mt for High Density, from 500 sq.mt to 1,000 sq.mt for medium density and over 1,000 sq.mt for low density
Notes: Statistics for all loans
Notes: Statistics for all loans
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The FBC Building Society was incorporated as Zimbabwe Building Society in 1992. In 2005, the institution changed its name to FBC BS after being acquired by FBC Holdings and the National Social Security Authority.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The legal fees include registration fees which are calculated as a percentage of the loan amount at approximately 3%.
Notes: The lending rate ranges from 0.15% for saving accounts to 20% for time deposits, which averages to around 10%
Notes: The lending rate ranges from 0.15% for saving accounts to 20% for time deposits, which averages to around 10%
Notes: The stamp duty tax ranges from 1 to 4%, depending on the value of the property. This transaction cost is paid by the buyer.
Notes: The stamp duty tax ranges from 1 to 4%, depending on the value of the property. This transaction cost is paid by the buyer.
Notes: There are 15 commercial banks, 5 merchant banks, 4 Building Societies (initially they were 5 then one was closed by the Regulatory authorities),1 savings bank, 16 asset management companies and 114 microfinance institutions. Mortgages are mostly funded by Building Societies.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These are verification fees charged by the Registrar of Deeds for deeds search.
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: These fees are transfer fees which are calculated as per percentage of purchase price approximately 7%
Notes: USD $25.00 for indivudual applications and $200 for commercial applications.
Notes: USD $25.00 for indivudual applications and $200 for commercial applications.
Notes: Valuation fees 1-2% of loan amount , administration fees 2-5% of loan amount
Notes: Valuation fees 1-2% of loan amount , administration fees 2-5% of loan amount
Notes: very small number
Notes: very small number
Notes: very small number
Notes: very small number
Notes: very small number
Notes: very small number
Notes: Zimbabwe is on a multi-currency regime and has no locally denominated currency loans.
Notes: Zimbabwe is on a multi-currency regime and has no locally denominated currency loans.
Notes: Zimbabwe is on a multi-currency regime and has no locally denominated currency loans.
Notes: Zimbabwe is on a multi-currency regime and has no locally denominated currency loans.
Notes: Zimbabwe's Central Bank lending rate was made dysfunctional with the introduction of the multi-currency system in February 2009 as the Central Bank's role of lender of last resort was made obsolete. This role was re-established from February 2011 but no lending rates have yet been set.
Notes: Zimbabwe's national income distribution is unknown. Only 5% of the working population works in the formal sector. Of these 49% earn more than USD $2000, 36% earn between USD $400 and USD $2000 and 59%earn less than USD $400 per month.
Notes: Zimstat defines "employed" as being productive and earning income in the field of activity