Attain homeownership on a budget

One of the aspirations of every Ugandan is to own their own home. The reality is that our consumerism
culture, poor saving habits, high prices of homes, and high mortgage rates may impede the ambition. A
reasonable price point of a home in a decent neighborhood is at least UGX 150 million – a considerable
sum of money given other competing expenses and the generally low salaries the majority earn.

As a developer in the affordable housing sector, I interact with several youths in their 20s – 30s. They
share their frustration about it being unattainable for them to own a home at their typical salary range
of UGX 500,000 to 1,000,000 a month before tax. Below are a few of my thoughts on how to attain
homeownership on a budget:

1. Have a long-time perspective: buying land in the "old neighborhoods" – Muyenga, Ntinda, Bugolobi,
Mengo, Rubaga, et al. may not be realistic for most. Neighborhoods such as Naalya, Kiwatule, Najera,
and Buloba that used to be viewed as distant from town a decade ago are now prime expensive areas.
Be open-minded to up-and-coming towns, for example, Kiwenda, Matugga, Kakiri, Lugazi, etc. You may
be able to find plots starting as low as UGX 10,000,000 in these locales. Within the next decade, towns
that may appear distant now will be prime. Explore options offered by credible land developers and
negotiate for a flexible payment plan. Who knows, you may be allowed up to 6 months to make
payment.

2. Use an incremental house design: Ask your architect for a building plan that enables you to construct
incrementally. Work with an expandable house plan, whereby you can start with one bedroom but can
add a second and third in the future. Other sections of the house, such as the sitting room and dining
room, can be added later! Start with something affordable and functional. Don't worry; you will get
there step by step!

3. Engage a well recommended general contractor: Ask the contractor for references and verify. Audit
the quality of work of the general contractor, rather than being the general contractor. Send payments
for materials directly to reputable hardware stores/materials businesses and not the contractor. Ask for
receipts and file them.

4. Budget: Before you begin construction, ask a Quantity Surveyor or Contractor to prepare a budget so
that you have a sense of the total cost of the project. Do the math and see if you can afford the house
plan that you have designed. Break down the house's total cost into ten years and see how much you
need to save each month to make the dream possible. For example, assume you can save USD 300 a
month consistently. USD 300 a month translates to USD 3,600 a year. USD 3,600 a year multiplied by a
construction period of 10 years totals USD 36,000. At a UGX/USD exchange rate of UGX 3,750, this
would mean that what you can afford is UGX 135 million. Ensure that the construction budget fits within
this range.

In summary, have a long-term perspective (plot out of town is ok, 10-year construction period is
reasonable); procure an incremental house design; hire a well recommended general contractor, and
prepare a construction budget before you begin the project. Above all, start today! Starting your project
will motivate you to skip that vacation to Vegas, reduce your spending on the next baby shower, and
save even further to shorten the construction period! Start today, and your dream of owning a home
will become a reality!
Authored by Jaffar Tonda (MBA, MAM), Director Synergy Properties – a leading real estate developer
with a focus on incremental housing.