Until about 2009, there was still an empty plot not far away from Mzee’s land. It was small (roughly 50ft by 70ft) and belonged to someone who had decided to relocate overseas. The plot was eventually snapped up by a prominent personality who I was told paid a cool Shs 900 million for that small strip of land.
He has since put up a nice block of apartments (six in total) but you can hardly park two cars in the compound. I remember telling Mzee that I thought the figure (Shs 900 million) was very inflated. He asked me what the value should have been. I told him not more than Shs 150 million.
“But this is Nitinda,” he retorted, “Not Kiwatule or Najjeera.”
I thought to myself: what is so magical about Ntinda?
Nothing apart from the historical name and presumed close proximity to the city (which is also cancelled out by the nasty traffic jam). While Ntinda is fairly better planned than so many upcoming suburbs, it still has potholed and narrow access roads.
There are pockets of insecurity, and congestion has set in as offices set up shop there. Yet you constantly hear that newly built houses in Ntinda are going for $1 million Shs 3.6 billion and wonder the justification for the prices.
When we went to Ntinda in 1987, most of Naguru was a big bush and was sparsely populated. Land there was cheaper than in Ntinda. Few people, notably Adoko Nekyon, lived there. In the early and mid-1990s, when most of Ntinda had filled up, Naguru became the next big thing.
Then the late Salim Bachu built a magnificent house overlooking the old Hakuna Matata bar (behind UMC hospital) and things changed. Everyone flocked there. Pastor Ssenyonga of Top TV, the late Mayanja Nkangi, the late Charles Muhangi, Mugabe of SC Villa, etc.
Naguru is now considered very prime and you hear plots of land going for $2 million. You would be lucky to find one.
But is it worth it?
Why would I buy an empty plot of land in Naguru for $2 million (minus the costs of grading it) and yet for the same money, I could buy four fully furnished two-bedroom apartments in Dubai (each at $500,000) and start earning from them immediately?
Assuming I am a businessman, which of the two options would give me a better rate of return on investment in the next ten years?
Due to the absence of a land policy and because most of the land transactions are fuelled by “deal money”, land prices in many prime areas of Uganda are inflated and do not reflect the actual value of the piece of land.
If someone steals Shs 3 billion from government and can’t put it on a bank account, they would not mind investing half of it in an empty plot in Naguru or Munyonyo. Thieves rarely think about the actual value of something they are buying because they want to ‘offload’ the money as soon as possible before they are caught.
And when the thieves are many and all are investing in land, it leads to general appreciation in the price of land. What this means, therefore, is that the price of land is not a true reflection of its value.
Indeed ever since some of the thieves were apprehended, land prices have stagnated and some land brokers are grassing. We need a concrete policy on land that will deal speculators a blow.
Would you rather buy the house in the potholed Bunga for $1 million or use that money to buy at least two three bedroomed fully furnished houses in Palm Jumeirah?
The author is the editor-in-chief of the Nile Post
