Knight Frank’s Zim Property Market Update: Explained

Knight Frank is a global real estate consulting firm that has a solid branch in Zimbabwe. Recently, they released a report on Zimbabwe's market trends in 2024. If you’re an investor, occupier, or landlord seeking clarity in today’s uncertain market, this article is for you.

Navigating Zimbabwe’s real estate market can be challenging, especially if you’re uncertain about where to invest in CBD areas like Harare and Bulawayo. This comprehensive article is designed for investors, occupiers, and real estate professionals looking to understand Zimbabwe property market trends in 2024.

Using up-to-date research from Knight Frank’s Zim Property Market Update 2024 and our own Propertybook data, we break down everything from GDP projections and inflation to rental performance and infrastructure challenges. You’ll find a clear picture of market performance, price differences, and business trends in Harare and Bulawayo’s central business districts (CBDs).

“The property market witnessed a surge in development activity, driven by both government initiatives and increased participation from financial institutions,” explains Knight Frank, underlining the dynamic shifts occurring across Zimbabwe’s urban centers.

Zimbabwe Economic and Market Performance

Zimbabwe’s CBD areas are evolving amid a challenging economic landscape. According to Knight Frank’s recent report, Zimbabwe’s economic outlook remains modest but hopeful. The country’s GDP is projected to grow at 2% in 2024, with expectations to reach 6% in 2025. Inflation has begun to stabilize; by December 2024, month-on-month inflation reached 3.7%, which is within the Reserve Bank of Zimbabwe’s target range. However, challenges such as exchange rate volatility, high cost of living, and the lingering effects of an El Niño-induced drought continue to influence market conditions.

Despite these headwinds, the property market has seen significant development activity. Government initiatives and increased participation from financial institutions have led to more mixed-use developments and residential projects. Yet, infrastructure constraints and regulatory hurdles remain a major concern. This is particularly evident in the CBDs, where outdated town planning and congested road networks are pushing businesses and even large institutions away.

“Addressing infrastructure constraints, streamlining regulations, and fostering a stable macroeconomic environment are crucial for achieving sustainable development,” explains the Knight Frank report.

Harare vs. Bulawayo: Office Vacancy Rates and Business Migration

One of the most striking contrasts between Harare and Bulawayo is seen in their office vacancy rates. According to the report, Harare’s CBD vacancy rate has reached 60%, a sign of deteriorating conditions in the city center. In comparison, Bulawayo’s CBD vacancy rate stands at 40%, reflecting a relatively better-maintained commercial environment.

Harare’s challenges are multifaceted. Increased traffic congestion—a reported 30% rise in recent years—combined with insufficient parking and deteriorating infrastructure has led to a significant exodus of businesses. Major corporate tenants have cited unreliable electricity and slow maintenance of facilities as key reasons for moving. In fact, several banks, including CBZ, First Capital Bank, and ZB Bank, are in the process of relocating or planning to build their headquarters in the northern suburbs (such as Highlands, Newlands, and Borrowdale) to escape the limitations of the CBD.

“The increasing traffic congestion, lack of parking, and deteriorating infrastructure in Harare’s CBD have made it less attractive to businesses,” states Knight Frank.

In contrast, Bulawayo’s CBD benefits from wider roads and less severe congestion, which has helped keep its vacancy rate lower. However, the overall scale of economic activity in Bulawayo is smaller, and property values are typically 15–20% lower than in Harare, reflecting its lower demand and reduced operating costs.

Property Price Comparisons in Zimbabwe CBD Areas

When evaluating investment opportunities, comparing property prices in Harare and Bulawayo is crucial. The report provides detailed pricing for various property segments:

• Harare’s Residential Market

  • High-Density Properties: Priced between US$60,000 and US$80,000.

  • Medium-Density Properties: Range from US$120,000 to US$250,000.

  • Luxury Properties: Can reach up to US$500,000.

• Bulawayo’s Residential Market

  • Generally, properties are 15–20% more affordable than those in Harare, appealing to cash buyers and small-scale investors.

• Office and Commercial Spaces

  • In Harare’s CBD, average office rental rates are around US$6.00 per square metre, while suburban areas command higher rates of about US$10.00 per square metre.

  • Bulawayo’s CBD office spaces are even more competitive, averaging around US$4.50 per square metre in the city center, with suburban areas slightly higher at US$7.00 per square metre.

These pricing differentials illustrate that while Harare’s market offers premium opportunities due to higher demand and centrality, it is also burdened by higher operational risks—especially in the congested CBD.

Knight Frank’s report also points out that despite the relatively low rentals, delayed payments by tenants are a significant concern in the CBD, affecting overall market confidence. This detailed pricing and rental information is essential for investors who need to balance affordability with long-term growth prospects.

Investment Potential and Trends

Investing in Zimbabwe’s CBD areas involves weighing various macroeconomic and local factors. Knight Frank’s report underscores several key trends that can influence your investment decisions:

1. Economic Recovery: With GDP growth anticipated to rise from 2% in 2024 to about 6% in 2025, there is cautious optimism about the country’s economic rebound. Sectors such as agriculture, mining, and tourism are expected to drive this recovery, creating new opportunities in the real estate market.

2. Foreign Investment Signals: The exodus of several foreign firms—like Barloworld, Unilever, and Nampak South Africa—has raised concerns over investor confidence. However, government initiatives, such as the development of the Afreximbank African Trade Centre in Harare, offer a promising catalyst for renewed regional investment. Knight Frank notes that this landmark project could “unlock growth and prosperity” for the local market .

3. Propertybook’s Exclusive Data: As Zimbabwe’s leading real estate platform, Propertybook’s database of over 8,000 properties and network of 2,000 agents provides unparalleled insights into market movements. Our data indicates competitive rental returns in the office sector, averaging 9%, and in the industrial sector, around 13%. Such figures, combined with Knight Frank’s insights, suggest that strategic investments in CBD locations can yield substantial long-term benefits.

Call to Action: Ready to explore investment opportunities? Visit Propertybook for up-to-date listings and detailed market reports.

Zimbabwe's Infrastructure and Regulatory Challenges

Infrastructure limitations and regulatory challenges are among the most critical factors impacting the Zimbabwe CBD market. Knight Frank’s analysis reveals several important factors. 

Power Supply

• Installed Capacity vs. Demand: Zimbabwe’s installed power capacity is only 2,800 MW, which is just 56% of the country’s current demand of 5,000 MW. This shortfall has led to frequent load shedding and reliance on backup generators, particularly in Harare’s CBD.

• Impact on Businesses: The need for alternative power sources, such as solar or gas, is critical. Properties equipped with solar backup or alternative energy solutions are becoming more attractive, as they help mitigate the operational risks of unreliable electricity.

Road Infrastructure and Traffic

• Harare’s Road Conditions: The CBD suffers from aging road networks, with a 30% increase in traffic congestion noted in recent years. This results in long commutes, high transportation costs, and general operational inefficiencies for businesses.

• Bulawayo’s Advantage: Although Bulawayo faces its own infrastructural challenges, its roads are generally wider and better maintained, which contributes to a lower CBD vacancy rate and more stable business conditions.

Regulatory Environment

• Zoning and Town Planning: Harare’s CBD is also affected by outdated town planning practices, zoning issues and regulatory hurdles which continue to pose risks for investors. The proposed Cluster Development Policy by the Harare City Council aims to increase densification, but concerns persist about the city’s infrastructure capacity to handle this growth. Knight Frank emphasizes the need for “streamlined regulations” to facilitate sustainable development.

• Property Rights and Registration: Complex registration processes and property rights issues further complicate investments in these areas. Investors are advised to work closely with local experts to navigate these regulatory challenges.

• Town Planning: Harare’s CBD faces increasing challenges due to rapid urbanization. The proposed Cluster Development Policy aims to boost densification, but concerns about the city’s infrastructure capacity remain prevalent. Business encroachment and informal activity in CBD areas are contributing to traffic congestion and degraded neighbourhood character.

For investors, these infrastructural and regulatory challenges represent both risks and opportunities. Strategic partnerships with local agencies and keeping abreast of policy changes are essential for mitigating risks associated with high operating costs and regulatory delays.

Call to Action: Learn more about how regulatory changes might affect your investments by visiting Propertybook's blog for expert insights and up-to-date market news.

Rental Market Insights

The rental market in Zimbabwe’s CBD areas is marked by both resilience and volatility. Knight Frank’s report provides a detailed breakdown of rental dynamics:

• Default Rates: Default rates vary significantly by asset class. The industrial sector experiences default rates above 25%, while retail properties show lower risks at around 10%. Office spaces in Harare, despite higher yields, report default rates averaging 15%—a significant concern for landlords.

• Tenant Behavior: With rising traffic congestion and high rental rates, many tenants are relocating from CBD areas to suburban locations. For example, rental rates in Harare’s CBD average around US$6.00 per square metre, compared to higher rates in suburban locales, which offer additional incentives such as free parking.

• Market Shifts: The trend towards decentralization, particularly in retail, is evident. Many large retail spaces are being reconfigured into smaller units to accommodate SMEs, reflecting a shift towards more flexible leasing arrangements.

Tenant defaults and delayed payments have particularly affected Harare’s CBD, leading to increased pressure on landlords to offer discounts or flexible leasing arrangements. In contrast, Bulawayo’s rental market, while reflecting lower rental rates, shows relatively more stable tenant behavior.

These rental market insights are crucial for both landlords and investors, as they highlight the need for robust risk management strategies and adaptive leasing models. By incorporating data from both Knight Frank and Propertybook’s real-time market updates, you can better anticipate fluctuations in rental demand and optimize your portfolio accordingly.

Business Migration and the Rise of Suburban Headquarters

The challenges in Harare’s CBD are not just affecting small businesses—large corporate entities are also reconsidering their location strategies. The report reveals a clear trend:

• CBD Exodus: Many businesses are moving out of Harare’s congested CBD due to poor infrastructure, inadequate parking, and unreliable power supply.

• Suburban Shift: Major banks, including CBZ, First Capital Bank, and ZB Bank, are relocating or planning to build new headquarters in suburban areas such as Highlands, Newlands, and Borrowdale. This migration is driven by the search for modern facilities, better road access, and more reliable utilities.

• Rental Increases in Suburbs: As a result, suburban office parks have seen rental increases of up to 12% year-on-year, while the Harare CBD struggles to attract quality tenants.

Call to Action: For real-time market updates and detailed property listings, visit Propertybook to explore the best suburban opportunities in Harare and Bulawayo.

Key Takeaways for Investors

Drawing on the comprehensive analysis from Knight Frank and Propertybook’s proprietary data, here are the essential points you need to consider when investing in Zimbabwe’s CBD areas:

1. Harare’s High-Risk, High-Reward Scenario:

   • Vacancy Rate: Harare’s CBD vacancy rate stands at 60%, driven by severe congestion and poor infrastructure.

   • Price Premium: While residential and commercial properties command higher prices, the operating risks are also elevated.

   • Business Exodus: Significant numbers of businesses, including major banks, are shifting to suburban locations to escape the inefficiencies of the CBD.

2. Bulawayo’s More Stable Environment:

   • Lower Vacancy: Bulawayo’s CBD shows a vacancy rate of 40%, and its properties are generally 15–20% more affordable.

   • Infrastructure Advantages: Wider roads and better-maintained public facilities contribute to a more reliable business environment.

3. Rental Market Insights:

   • Default Rates: Office defaults average 15% in Harare, while the industrial sector’s defaults are above 25%.

   • Yields: Although Harare’s office yields are about 9%, the market is under pressure from delayed tenant payments.

   • Suburban Growth: With suburban rental rates increasing by up to 12%, shifting your focus to areas outside the CBD could lead to more stable returns.

4. Infrastructure and Energy Considerations:

   • Power Supply Shortfalls: With only 2,800 MW installed versus a demand of 5,000 MW, properties with alternative power solutions are becoming crucial.

   • Regulatory Challenges: Outdated town planning and complex property registration processes require investors to seek expert advice.

By carefully weighing these factors, investors can make informed, data-driven decisions in a market that is both challenging and full of potential. The detailed insights provided by Knight Frank’s Zim Property Market Update 2024 and Propertybook’s comprehensive local data offer you a clear roadmap to navigate these complexities.

Expert Commentary and Data Credibility

Propertybook’s authority in the Zimbabwe real estate market is reinforced by our long-standing industry presence and robust data collection. Founded in 2006 and operating online since 2015, we have built partnerships with over 130 real estate agencies, covering more than 80 cities and regions across Zimbabwe. Our platform not only aggregates over 8,000 property listings but also provides weekly statistical updates and expert commentary—backed by firsthand market experience.

Knight Frank’s report further validates our insights by offering detailed analysis and verified data points. For example, their findings on rental defaults, tenant behavior, and the economic impact of infrastructure limitations add a layer of credibility to our assessments. As Knight Frank states, “Despite rentals remaining relatively low, tenants are still failing to pay on time,” highlighting a persistent challenge in the market .

Our approach at Propertybook emphasizes transparency and reliability. With over 2,000 agents and a community reach that includes 93 active Facebook groups, our network provides an authentic pulse on the local market. By combining our proprietary data with independent research from reputable sources like Knight Frank, we deliver a balanced and trustworthy perspective on Zimbabwe’s real estate landscape.

Call to Action: Stay ahead of the market—subscribe to Propertybook’s weekly stats reports and expert commentary for the latest insights on Zimbabwe’s property trends.

By analyzing key metrics from Knight Frank’s Zim Property Market Update 2024 and combining them with Propertybook’s proprietary insights, you now have a clear roadmap to navigate Zimbabwe’s CBD property market in 2025. This detailed overview not only highlights current challenges but also uncovers opportunities for growth, ensuring you’re well-equipped to make strategic investment decisions in this dynamic environment.

For more information on the latest market trends and property listings, visit Propertybook today and join our community of hundreds of thousands of engaged property enthusiasts.

Data last updated: March 2025. Market conditions may vary. Always consult a registered agent for current rates and regulatory updates.