Zimbabwe property development: the quarterly review

Zimbabwe’s property market is repricing, not by much in headline terms, but decisively in composition. The story of this quarter is not what happened to prices. It is what happened to the relationship between price, income and delivery risk.

Four movements are worth the attention of anyone deploying capital into Zimbabwean real estate. We take them in turn, then set out what we expect to see next.

1. Headline pricing has stopped doing the work

For two decades the Zimbabwean property thesis was straightforward: buy land, hold it, watch it appreciate. That thesis is exhausted, and the market is adjusting to its absence.

National price growth is forecast at 2 to 3 per cent for 2026, meaningful stabilisation rather than the step-changes of prior cycles. Average property prices in Harare sit around US$240,000, having risen roughly 80 per cent over five years in prime suburbs; Borrowdale averages approach US$860,000. Bulawayo runs 15 to 20 per cent below Harare, with Hillside averaging around US$85,000.

Rental yields nationally average 8 to 10 per cent, and Zimbabwe’s residential market was estimated at approximately US$85 billion in 2025 with a compound growth forecast above 5 per cent through 2029.

Read together, these figures describe a market in which income, not capital appreciation, has become the return driver. That is a healthier market and a more demanding one. It rewards developers who can deliver lettable, occupiable, serviced product and punishes those whose model depended on land inflation.

2. Yield dispersion has widened, and it is inverted against risk

The most useful table in Zimbabwean property research is also the most awkward. Knight Frank’s sector return figures, from its most recent published Zimbabwe market update:

Sector · Rental return · Rent default rate

Retail · 8% · under 10%

Office · 9% · 15%

Industrial · 13% · above 25%

Industrial offers the highest headline return and carries by some distance the worst default experience. Retail offers the lowest headline return and the best. An investor pricing off the headline yield alone is systematically buying the wrong risk.

Industrial yields had risen from 11 per cent at end-2023 to 13 per cent, which is not a sign of strength. Yields rise when prices fall relative to income, and they rise fastest where income is least certain. Until increased activity in agriculture and mining translates into genuine demand for industrial space, we would treat the industrial premium as compensation for default risk rather than as an opportunity.

3. The central business district decline is structural, not cyclical

This is the movement with the longest tail, and it is not being priced properly.

Office vacancy in the Harare central business district has reached 60 per cent; Bulawayo’s stands at 40 per cent. Thirty per cent of businesses formerly located in Bulawayo’s CBD relocated to suburban areas, Suburbs and Khumalo, between 2020 and 2025. In Harare, effectively every major bank has relocated, is planning to relocate, or is building a head office in the northern suburbs.

The causes are cumulative and none of them are reversing quickly: ageing and undermaintained building stock; rising CBD crime; traffic congestion; and parking economics that are simply absurd, US$1.00 per hour casual parking in town against free parking in suburban office parks. The rental consequence is inverted against every textbook: CBD rents average US$6.00 per square metre while suburban locations achieve US$10.00.

Two conclusions follow.

First, a substantial share of Zimbabwe’s institutionally-held CBD office stock is impaired, and pension funds carrying it at historic values will eventually have to say so. Revitus’s strategy, acquiring distressed commercial buildings at a discount and repurposing them as modern green buildings, is the correct institutional response to this problem, and there is far more of it to do.

Second, suburban low-density residential precincts are absorbing demand from two directions at once: households, and the commercial occupiers displaced from town. A house in Suburbs or Khumalo now has an alternative use, and alternative use is what supports value.

4. The capital stack has changed hands

Zimbabwe’s development market is no longer financed by banks in any meaningful sense. Real estate receives roughly 5.8 per cent of the national loan book through mortgages and 1.2 per cent through construction facilities. With the policy rate having sat at 35 per cent, the cost of borrowing is not merely high; it is prohibitive for a development programme.

What has filled the gap is institutional and offshore capital.

• Pension funds hold 45 to 65 per cent of assets in property, against an international norm of 10 to 20 per cent, on a sector asset base of approximately US$2.6 billion.

• Three listed REITs, Tigere, Revitus and Eagle, now exceed US$100 million in aggregate market capitalisation. Tigere passed US$101 million in late 2025 following the Greenfields Retail Centre and Zimre Park acquisitions, and is targeting a minimum US$1 million quarterly dividend for FY2026 with four further yield-accretive acquisitions planned. Eagle REIT, the first USD-denominated development REIT, is targeting US$62 million with US$24.5 million secured.

• WestProp held investment property of US$157.77 million at end-2025.

• The Mutapa Investment Fund reported gross asset value of US$16.3 billion at end-2025, up from US$14.8 billion, with a US$1.075 billion pipeline for 2026.

• The diaspora remitted US$1.9 billion in the first nine months of 2024 alone, approximately a quarter of national foreign currency earnings, with estimates of annual diaspora real estate investment potential in the US$800 million to US$1 billion range under appropriate policy.

The practical implication for developers is that the capital conversation has moved. It is now an investment committee conversation, not a credit committee one, which means underwriting standards, sensitivity analysis, phasing and governance matter more than security and covenant.

5. Energy has become a valuation input

Knight Frank recorded the position bluntly: new development projects do not readily obtain power on completion unless an alternative source is provided, and developments both new and existing are switching to solar and gas.

Zimbabwe’s installed capacity is approximately 2,317 megawatts against peak demand of roughly 2,200 megawatts, with actual available capacity of 1,200 to 1,400 megawatts depending on hydrology. The deficit runs at 800 to 1,000 megawatts.

For a developer this is no longer a servicing footnote. A scheme that cannot demonstrate energy resilience at handover carries a discount, and a scheme that can carries a premium. This is why the distinction between our real estate and renewable energy divisions is becoming, in practice, less useful than it once was.

What we expect next

Continued decentralisation. We see no mechanism that reverses the CBD outflow within the current cycle. The infrastructure investment required is large, municipal, and not funded.

Widening quality dispersion. Prime, well-serviced, energy-resilient assets will hold value; secondary stock will not. Averages will become progressively less informative.

Growing REIT relevance. With three listed vehicles, prescribed asset eligibility and USD-denominated structures on VFEX, the listed sector is the most likely route by which pension money rebalances out of directly-held offices.

Pressure on peri-urban land. Emerging corridors and serviced-stand supply are where the volume growth sits, and where servicing standards will be tested hardest.

A slow return of comparability. Better digital price indexing is improving pricing transparency, which will mostly benefit buyers in the near term.

A note on the figures

Zimbabwean property data is thin, and readers should treat it accordingly. Sector return and vacancy figures in this note derive from Knight Frank’s most recently published Zimbabwe market update and should be read as at that date rather than as at today. Pricing and forecast figures derive from 2026 market commentary. Where a figure carries no date, assume it is older than you would like. We would rather flag that than smooth over it.

*This article is provided for general information and does not constitute investment advice or a valuation opinion.*

Sources: Knight Frank, *The Zimbabwe Market Update, H2 2024*; Property.co.zw, *Zimbabwe Property Market Outlook 2026*, January 2026; Intela, *Capital Deployment in Zimbabwe’s Real Estate & Renewable Energy Sectors* (2024–2026); Intela, *IPP Market Intelligence Report*, March 2026.