The property market in Botswana is experiencing a boom despite the rise in interest rates, escalating costs of construction materials and the sub-prime mortgage crisis.
'We are going through a boom right now and I foresee it lasting for the coming three to four years,' Phakalane Properties Managing Director Lesang Magang said in an interview.
He said unlike South Africa or the United States of America (US) whose property markets are going through a slump because of high interest rates, construction materials and the sub-prime crisis, the Botswana market is flourishing. Magang said Botswana is not much affected by these factors because of renewed confidence in the economy largely due to diamond beneficiation, accelerated government spending and implementation of various mega projects.
He said the market had a pent-up demand over the last three years until mid last year when things started picking up. As a result, rent and value have been going up in both residential and office properties.
'The coming of DTC Botswana is one the things precipitating that boom because all of a sudden hundreds of millions of Pula are being spent on a specific project that has multi-tier projects attached to it.'
The multi-tier projects attached to DTC Botswana include 16-diamond cutting and polishing companies aggregation. Magang hopes the jewellery side of the business will eventually flourish to further boost the economy. He said the upsurge in mining activities of other commodities like coal, copper and nickel has also contributed to the boom in the property market across the country, Francistown being
Magang said it is not too late for Botswana to emulate Dubai given its stable economy and thriving democracy.
For the country to have foreign direct investment (FDI) coming its way like Dubai, there is need for property development that offers lifestyle rather than just accommodation.
'If you provide quality lifestyle, like we do at Phakalane Golf Estate, the rich and the famous will come and invest in our country.'Another incentive that he raised at the economic forum was that for Botswana to attract more FDIs, it has to look at its labour laws and tax incentives.
'I am not saying Dubai or Mauritius are the best but they have incentives like immediately granting permanent residence to all foreign investors and it has worked wonders for their economies.'
When asked if property in Botswana is overpriced, Magang said: 'Yes if you only look at it internally but when comparing it with countries like South Africa, Botswana is under priced for its land.'