In this competitive and volatile world, one needs a home of his or her own. In Rwanda with every one working towards achieving Vision 2020, it has also become very important for the individual families to own a house. The issue is increasing urban boundaries that make the cost of living high.
Mzee Bernard who owns a restaurant at Kacyiru believes most people have been kicked out of business because of high rent expenses. He adds that most houses were built on loans. To service bank loans, landlords keep increasing rent monthly.
And if tenants fail to pay they are kicked out of the premises.
Bernard’s former employers are victims. They were kicked out of business because they could not meet the financial demands of the landlord owning a posh building near parliament.
To survive in Kigali City, Bernard, a professional cook is now operating in what used to be a kitchen. He pays the landlord Frw100,000 monthly for this small place. But most times, his customers sit at the veranda if they are to have meals.
“I wanted to operate from an area which has a big population and I thought of Kigali Business Centre, but most landlords charge between $2,000-3,000 per month,” he explained.
Koko Mbange a salon owner laments: “With landlords you never know what they will do next. They are highly unpredictable. Any time they can increase rent.”
Most landlords say, they have been forced to increase rent partly because of the scarce and expensive building materials that are mostly sourced from neibouring countries. Rwanda partly depends on cement, timber iron sheets bars needed in construction from neibouring countries.
This pushes the prices high. Suzan Assimwe, the marketing officer of Real Contractors says purchasing building materials from abroad increases rent prices in absolute terms.
“You may buy inflated materials outside Rwanda and if taxed then automatically it makes building expensive,” she said.
Dan Kayonga, the Social Security Fund of Rwanda publicist says that besides that, land in Rwanda is ever gaining value making building expensive. He also believes that the houses whose cost was Frw24m in 2004, of recent their market value is Frw 50m. The price of a plot of land is also relatively high depending on its location.
Martine Karegeya of Kabuga–Gako sector says that the plot he bought in 1998 at a price of Frw Frw250,000 is currently valued at Frw2.5m. In some places like Kicukiro- Niboye sector, a plot of land has hit a record mark of Frw5m, five years ago the same plot used to cost less than a million. But to Isaiah Kayiranga, a landlord in Remera says high demand of housing is pushing rent fees prices high.
“Of recent I have not constructed any building so I don’t have the cost figures on my finger tips but am always guided by the market forces to fix the prices,” he explained.
Few players in the market and some banks’ unwillingness to commit funds into mortgage loans have also played a crucial role towards the escalating rent expenses for houses.