Reduce the Property Transfer Tax to 5% from 8% – Expert

A real estate expert has raised concern […]

A real estate expert has raised concern over the increased property transfer rate to 8% from the initial 5%, suggesting a reduction. Speaking in an interview with the Zambian Business Times– ZBT, Victors Hill Estate Managing Director Chrispin Samiselo said this is impacting the market negatively because some buyers and sellers are reluctant to fully engage in the market.

This has led to middle-income families and buyers alike delaying purchases or rather choosing rentals instead. “It would be beneficial to the real estate sector if the PPT were reduced back to 5%, as things stand, the hike deters buyers and sellers from fully engaging in the market, and also self-builders, resulting in fewer property sales,” Samiselo.

At the same time, the hiked PPT is a letdown for the sellers, leading to a lowering of listing prices in a bid to attract buyers in a volatile market. However, sometimes buyers are forced to underdeclare property values on paper, undermining the formalization of land markets.

 According to information gathered by the ZBT, the high PPT is likely to affect the inflow of investments and development due to lower expected return, leading to less commercial redevelopment.

By Samuel Mutale