Monday, February 26, 2024

BHC’s rental revenue remains an uphill trudge

Botswana Housing Corporation (BHC) registered a decline of about 2 percent in rental income between 2016, for the year ended 31 March 2016, and the corresponding period in 2015. 

The sale of housing inventories on the other hand recorded an increase of about 22 percent. The corporation had at the beginning of the year (2016) incurred a cost of P352,4 million on completed houses, 365,4 million on houses under construction and 12,7 million on land held for development. By the end of the year the corporation anticipates that the cost of completed houses will be about P228 million, and that of houses on construction to be P190,2 million and the land held for development to be P27,8 million. In comparison to beginning of the year the cost of the land held for development is expected to increase whereas that of houses under construction and completed houses is anticipated to fall. The results generally show a decline in the cost of houses under construction in 2016 from the previous year but the specific figure of houses under construction is not specified, which could in part attribute to the total costs incurred. 

The tenant purchase scheme registered a meager revenue of about P3 million, from P4 million in 2015. The scheme was re-launched by Minister of Lands and Housing Prince Maele in August 2016 as a drive to ensuring that as many Batswana have access to affordable housing. Maele was quoted saying, “I made this decision after realizing that the scheme could offer an alternative vehicle through which we could facilitate and promote affordable home ownership by enabling Batswana currently leasing BHC houses to purchase the houses on relaxed installment terms over a maximum repayment period of 25 years.” Based on the figures posted by the corporation on the scheme, it seems such an aspiration will take a lot of doing to drive a significant number of sitting tenants to take up the opportunity offered them. 

BHC has in the past battled to keep the costs related to constructing houses within margins that can ensure a healthy profit that can be ploughed back into the constructing cycle. With rising costs the effort could get even tougher for the corporation but providing affordable housing remains pivotal, which based on the rental revenue striking a balance proves challenging to the corporation.


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