Can Foreigners Buy Property in Zimbabwe? A Guide to Property Ownership and Investment Opportunities

Known for its iconic landmarks like Victoria Falls and vast wildlife reserves, Zimbabwe offers a wealth of agricultural and urban investment opportunities. However, Zimbabwe’s laws on foreigners possessing property are complicated and influenced by historical land policies and changing regulations. This article examines the legal framework, benefits, and challenges foreign nationals face when acquiring property in Zimbabwe. As a country rich in cultural heritage, natural wonders, and economic potential, Zimbabwe has a unique appeal for investors and expatriates considering real estate opportunities in Africa.

Property Ownership in Zimbabwe – An Overview

Zimbabwe’s colonial past and a land distribution program made to rectify historical injustices have influenced the country’s property laws. The nation currently employs a combination of state and customary property laws, each with unique regulations for both domestic and foreign investors. Zimbabwe’s land is categorized primarily into private, communal, and state-owned land. While communal land is managed according to traditional systems, private land can be sold or leased, while state-owned land is available primarily for lease.

Land in Zimbabwe is also classified into agricultural and urban sectors, with specific policies for each type. Foreigners interested in Zimbabwe’s property market generally focus on urban or commercial real estate, as agricultural land acquisition remains restricted to Zimbabwean citizens or companies. Over the years, the government has shown a growing interest in attracting foreign investment, but certain restrictions and approvals remain essential for foreign buyers.

Foreign Ownership Regulations in Zimbabwe

Under Zimbabwean law, there are many restrictions on foreign ownership of property. The country’s policies typically allow foreign nationals to buy property with certain conditions, but outright ownership is often challenging. As per the legal framework, foreign nationals can obtain land or real estate in Zimbabwe under the following conditions:

Leasing Options for Foreign Investors

While purchasing land for personal use is restricted, leasing has become a popular option for foreign nationals. Leases are available for a range of periods, generally up to 99 years, depending on the type of land and the nature of the investment. A 99-year lease is usually granted for agricultural or commercial land, giving lessees significant rights to use the land, develop it, and resell the lease. Shorter leases are often available for residential properties, providing an alternative to outright ownership.

Joint Ventures and Partnerships

One of the most common ways for foreigners to invest in Zimbabwe’s property market is through partnerships or joint ventures with Zimbabwean citizens or companies. In many cases, foreign investors collaborate with local businesses or individuals to establish co-ownership of the property. These partnerships allow foreigners to benefit from local expertise, ease the regulatory process, and meet the requirements set by the government for property acquisition.

Joint ventures also provide advantages to both parties: local partners gain access to foreign investment capital, while foreign investors benefit from the local knowledge, connections, and market insights that Zimbabwean partners can provide. These cooperative agreements are especially prevalent in the commercial real estate industry, where office, hotel, and retail developments are attracting more and more foreign investors.

Special Economic Zones (SEZs)

Zimbabwe has designated certain areas as Special Economic Zones (SEZs) to attract foreign investment and promote economic development. Properties within SEZs are subject to specific regulations that differ from the rest of the country, often including tax incentives and relaxed ownership rules for foreigners. Foreign investors who acquire property in SEZs may benefit from a streamlined process and the potential for longer lease terms, making SEZs an attractive option for those looking to enter Zimbabwe’s real estate market.

Key Regulations Affecting Foreign Property Acquisition

Foreign nationals interested in purchasing or leasing property in Zimbabwe must navigate several vital regulations and requirements. These regulations ensure that foreign investment contributes positively to the economy and complies with Zimbabwe’s strategic goals:

1. Approval from the Ministry of Lands, Agriculture, Fisheries, Water, and Rural Resettlement
2. Foreign nationals must obtain permission from the Ministry of Lands, Agriculture, Fisheries, Water, and Rural Resettlement before engaging in any real estate transactions. This approval process ensures that land use aligns with Zimbabwe’s development objectives, especially for agricultural and commercial projects. Foreign investors must demonstrate how their intended land use supports economic growth or addresses other national priorities.
3. Complying with Indigenization and Economic Empowerment Policies
4. Zimbabwe’s Indigenization and Economic Empowerment Act, introduced in 2008, established policies to promote economic opportunities for local Zimbabweans. Under these policies, foreign companies in specific sectors must include Zimbabwean stakeholders, holding at least a 51% share. However, the act only applies to some sectors, and recent reforms have relaxed these requirements in some industries. Nevertheless, foreign investors should understand how indigenization policies might impact their property transactions and structure partnerships accordingly.
5. Exchange Control Regulations
6. Zimbabwean exchange control regulations govern the movement of capital into and out of the country. Foreign investors must obtain approval from the Reserve Bank of Zimbabwe for significant investments or property acquisitions to ensure compliance with exchange control policies. Exchange control regulations impact how funds can be transferred, repatriated, or reinvested within Zimbabwe, affecting overall investment costs.
7. Environmental and Zoning Compliance
8. For agricultural or commercial land investments, environmental and zoning compliance is mandatory. The Environmental Management Authority (EMA) regulates ecological practices, including land use, to ensure projects do not harm natural resources. Investors must adhere to zoning laws, which define the type of structures and activities permitted on specific land plots.

Steps to Acquiring Property in Zimbabwe as a Foreigner

Foreign nationals can take the following steps to acquire property or secure a lease in Zimbabwe:

1. Determine the Type of Property and Purpose
2. Identifying the desired type of property, such as residential, commercial, or agricultural, helps streamline the acquisition process. Foreigners typically focus on urban properties or commercial spaces, given the restrictions on agricultural land ownership.
3. Engage with Local Partners or Establish a Joint Venture
4. Foreign investors may benefit from partnering with local Zimbabwean individuals or companies, particularly for commercial projects. Joint ventures allow foreigners to meet legal requirements, while local partners bring valuable market insights and connections to navigate regulatory procedures.
5. Obtain Necessary Government Approvals
6. Foreign property transactions require various government approvals, including clearance from the Ministry of Lands and the Reserve Bank of Zimbabwe. Depending on the property type and intended use, additional permits or approvals may be needed from the EMA or local zoning authorities.
7. Register the Property Lease or Partnership Agreement
8. Once all approvals are obtained, the final lease or partnership agreement must be registered with Zimbabwe’s Deeds Registry. This registration formalizes the legal rights of the foreign investor to use or develop the property, establishing the investor’s ownership or leasehold rights within Zimbabwean law.

Investment Opportunities in Zimbabwe’s Real Estate Market

Zimbabwe’s real estate market offers promising prospects despite its complex property laws. Due to urbanization, population growth, and government initiatives to encourage foreign investment, there is a steady rise in demand for residential, commercial, and tourism-related real estate.

Travel and Hospitality

The tourism sector in Zimbabwe is particularly vibrant, with iconic attractions such as Victoria Falls drawing visitors from around the world. The hospitality industry benefits from the rising number of international tourists, making hotels, lodges, and eco-tourism facilities beautiful investment options. Foreign investors have shown interest in developing hospitality facilities, capitalizing on Zimbabwe’s natural beauty and the government’s support for tourism.

Commercial and Retail Real Estate

Zimbabwe’s major cities, including Harare and Bulawayo, have a growing demand for commercial and retail spaces. Foreign investors are drawn to these urban centers for office developments, retail complexes, and mixed-use properties. The rising middle class and increased consumer spending support the expansion of retail centers and shopping malls, creating opportunities for foreign investors seeking a foothold in urban property markets.

Agricultural Land Leases

While foreign ownership of agricultural land is restricted, leasing agrarian land for investment is a viable option. Zimbabwe’s rich soil and favorable climate make it an ideal location for agricultural ventures. Foreign investors can lease land for projects related to crop production, livestock, and export-focused farming initiatives, contributing to the farm sector’s development while adhering to leasing regulations.

Challenges Faced by Foreigners in Zimbabwe’s Property Market

Though Zimbabwe’s property market holds significant potential, foreign investors face particular challenges:

• Strict Ownership Restrictions and Lengthy Approval Processes
• Zimbabwe’s restrictions on foreign land ownership and its rigorous approval processes can deter investors. Navigating these regulatory requirements demands time and patience, making local partnerships essential.
• Currency and Economic Instability
• Zimbabwe has experienced economic volatility in recent years, affecting property values and currency stability. Inflation and exchange rate fluctuations pose risks for investors, impacting returns on investment and complicating profit repatriation.
• Infrastructure and Financing Limitations
• Some areas in Zimbabwe need more reliable infrastructure, such as roads, electricity, and water supply, which may limit investment viability in certain regions. Additionally, financing options for foreigners are limited, as local banks often impose restrictions on foreign borrowers, increasing the cost of property acquisition.

Future Prospects and Policy Changes for Foreign Investment

The Zimbabwean government has shown interest in reforming policies to attract more foreign investment. Although direct ownership of land by foreigners remains restricted, recent shifts in government policy suggest an openness to easing restrictions in specific sectors, mainly tourism and commerce. These changes aim to boost the investment climate in recognition of the potential financial benefits of attracting foreign investors.

In conclusion, while direct property ownership is limited for foreigners in Zimbabwe, leasing options and partnerships give viable alternatives for those interested in the country’s real estate market. Despite the complexities, the country’s diverse investment opportunities, from tourism to commercial properties, make Zimbabwe an appealing option for international investors. Foreign nationals can effectively interact with Zimbabwe’s real estate market and capitalize on its long-term potential by being aware of its legal framework, establishing local partnerships, and navigating the regulatory environment.