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The
luxury housing sales market is dominated by investor-landlords
intending to let to foreigners. The expatriate market can be
broadly divided into two, according to Knight Frank, the old
areas and the new.
The old areas have been established expatriate housing areas
for more than a decade. These areas are within the city centre.
They are generally more expensive.
The new areas are on the outskirts of the city. They usually
have better views, and are less expensive.
The 1996 Constitution grants land ownership rights solely to
citizens of Uganda. Foreign nationals and corporations may,
however, obtain leases for 49 or 99 years.
RENTAL YIELDS
Yields are high in Kampala
The increase in supply and development and the refurbishing of
existing supply is exerting downward pressure on rents, but
yields are still quite high at around 8.6% to 10%.
Rents are around US$6 to US$8 per square metre (sq. m) per
month (around Ugandan Shilling (UGS) 11,635 to UGS14,300). So
the rent for a 200 sq. m. property would be around UGS2.5
million (US$1,358) per month.
Selling prices very widely from between UGS1.5 million and
UGS10 million (US$815 to US$5,432) per sq. m.
There are no serious issues of security, power or water supply
in the established expatriate areas, but it always helps to
have a back-up generator. | View Yields Table
LANDLORD & TENANT
Large advance rent payments are normal in Ugunda
Rental market practice is pro-landlord.
Rent: Rents and rent adjustments can be freely negotiated.
Rents are paid three months to one year in advance, with
subsequent rents paid quarterly, in advance. However, as the
market becomes more of a tenant’s market, one year advance
payments are becoming less popular.
Tenant Security: There are no specific tenant protection laws,
and it is relatively easy to evict tenants. | View Full
Article
BUYING GUIDE
Ugunda's total transaction costs are moderate
The round-trip transaction cost. i.e. the total cost of buying
and selling a property, is around 7.5% to 12.7%. The biggest
cost is the real estate agent’s commission, at 5% to 10%. Most
fees are fixed, and paid by the buyer.
Real estate transactions are typically quoted and concluded in
Ugandan Shillings. | View Full Article
TAXES & COSTS
Top
Rental income tax is moderate in Ugunda
Rental Income: Rental taxes are imposed on all individuals
earning rental income in the country, at 15% of gross income.
Capital Gains: There is no capital gains tax.
Inheritance: There are no inheritance or gift taxes.
Residents: Residents of Uganda are taxed on their worldwide
income.
ECONOMIC GROWTH
Unparalleled 20 years of growth
Uganda is a major safari destination with a large primate and
bird population and a diverse landscape, dense jungles, and
white-water rafting on the Nile. Tourists can also relax on
the shores of Lake Victoria – the second largest body of fresh
water in the world.
In the years following independence in 1962, Uganda
experienced dictatorship and military rule. Most notably, Idi
Amin rose to power in 1971 and imposed a reign of terror. His
incompetence ruined the economy and he expelled about 50,000
Asians. From 1970 to 1980, government-initiated violence
killed about half a million people.
Museveni's enormous achievement has been to put all that
behind Uganda. From 1995 to 2005, the average annual GDP
growth was 6.4%. Inflation was down to 8.2% in 2005 from a
peak of 240% in 1987.
Crime levels are low, but it is advisable to avoid the
northern region, where there is fighting between the Lord’s
Resistance Army (LRA) and government troops.
Though GDP per capita rose 76% in real terms between 1986 and
1995, poverty remains a serious problem, and 72% of the
population live below the poverty line.
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