Diaspora Real Estate | Brick by brick – How to achieve your dream of owning a home in Uganda.

Posted January 5, 2018 by Ugandan Diaspora News Team in Diaspora Real Estate ~ 5,469 views


One of the typical aspirations of Ugandans living in the Diaspora is to own a home in Uganda. The sad reality is that the high prices of homes, coupled with comparatively high mortgage rates impede the attainment of this dream. The price point of an average home in a well-established neighborhood is at least UGX 250 million. The related monthly mortgage instalment at an 18.5 percent annual interest rate over a term of 10 years is UGX 4.6 million. At the current UGX/USD exchange rate of UGX 3,650 this is USD 1,260 a month. This tends to be a considerable sum of money given other competing expenses.

The usual modus operandus of people living in the Diaspora to home ownership is to purchase a piece of land, and build incrementally with their relatives acting as general contractors. The potential frustration this option presents include the following: less than desirable construction quality, diversion of funds sent for construction to settle other family matters, and in a few cases outright fraud/theft.

High home prices/mortgage rates and disappointment endured by buying land and building incrementally with the help of relatives is a deterrent for many, who instead choose to hold onto their hard earned savings and postpone the dream of owning a home. What is the way forward? How can one own a home within a reasonable period of time? I recommend the following steps:

1. Have a long time perspective: buying affordable land in the “old neighborhoods” – Muyenga, Ntinda, Bugolobi, Mengo, Mpererwe, et al may not be realistic for most. In addition, neighborhoods like Naalya, Kiwatule, Najeera, and Buloba that used to be viewed as distant from town a decade ago are now prime expensive areas. Be open minded to up and coming areas for example Gayaza Road, Matugga, Kakiri, Lugazi, etc. You will be able to find plots starting as low as UGX 5,000,000 in these locales. Within the next decade, towns that may appear distant now will be prime. Explore options offered by credible land developers and negotiate for a flexible payment plan. Who knows, you may be allowed up to 6 months to make payment.

2. Use an affordable incremental house design: Browse the web/ask your architect friend for a house plan that enables a house to be constructed incrementally. It is normal to dream of a big mansion/dream home. For most individuals, the cost of that dream home may be on the higher side. Remember, this house will not be the only house you will build in your lifetime. Consider this your first home with more to come. Work with a house plan that is expandable whereby you can start with one bedroom but in the future you have the ability to add a second, third, or fourth room. Other parts of the house like the sitting room and dining room can be added later! Start with something affordable and functional. Don’t worry, you will get there step by step!

3. Use a well recommended general contractor: Ask the contractor for references. Call the references to ascertain that indeed the contractor has reasonable experience. Request your relatives to audit the quality of work of the general contractor, rather than asking them to be the general contractor. Send payments for materials directly to reputable hardware stores/materials businesses, and not the contractor or relatives. Ask for receipts and file them.

4. Construction budget: Before you begin construction, hire a qualified Quantity Surveyor to prepare your construction budget so that you have a sense of the total costs of the proposed construction. That way you can do the math and see if you can afford the house plan that you have designed. Break down the total cost of the house into eight years and see how much you need to save each month to make the dream possible. What I typically recommend to clients is to start with an amount they are able to save a month for construction and project outwards. Let us say you are able to consistently save USD 300 a month. USD 300 a month translates to USD 3,600 a year. USD 3,600 a year multiplied by a construction period of 8 years totals USD 28,800. At a UGX/USD exchange rate of UGX 3,650 this would mean that what you can afford is UGX 105 million. Ensure that the construction budget fits within this range.

In summary, have a long term perspective (a plot out of town is ok, 8-year construction period is reasonable), procure an affordable incremental house design, hire a well recommended general contractor, and prepare a construction budget before you begin the project. Above all, start today! Starting your project will motivate you to skip that vacation to Vegas, reduce your spend on the next baby shower, and save even further to shorten the construction period! Start today, and your dream of owning a home in Uganda will become a reality!

Authored by Jaffar Tonda, Team Leader Synergy Partners Uganda – a leading real estate developer with a focus on affordable housing.

About the Author

Ugandan Diaspora News Team

Ugandan Diaspora News Online is an independent, non political news portal primarily aimed at serving Ugandans who work and reside outside Uganda. Our aim is to be a one stop shop for everything Ugandan and the celebration of our Ugandan heritage.



    This is a brilliant piece even for someone not in living in the diaspora


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