High interest rates stifle property market growth

Despite the prevailing low interest rates regime prescribed by the Bank of Botswana’s accommodative monetary policy, a late 2014 liquidity dearth has pushed up the cost of funds for banks leading to higher interest rates on commercial loans. In its 2015 annual report, PrimeTime says adding to the existing challenges in the domestic market primarily the limitation of its size, supply issues and the intensity of competition for good quality investments has been the difficulty in securing funding.

“The terms on offer from the commercial banks are stifling activity with some lenders raising interest rates on existing facilities when the opportunity has arisen.