Buying a home in Zimbabwe has long meant paying in cash, putting ownership beyond the reach of many households in an economy where long-term credit is scarce. Now, WestProp Holdings Ltd., the country’s largest listed property developer, is looking to change that.

The company, led by real estate tycoon Ken Sharpe, is in final talks to appoint a CEO for West Cap Mortgage, a lending business licensed at the Victoria Falls International Financial Centre. The unit plans to raise a $1 billion fund by next year to offer 10-, 20- and 30-year home loans.

How Zimbabwe could unlock housing wealth

The plan comes as Zimbabwe faces a housing shortage estimated at as many as 2 million units, with Harare and Bulawayo accounting for about 70 percent of the deficit. Years of inflation and currency instability have pushed local banks away from mortgage lending, leaving much of the property market dependent on cash buyers.

“We have 100 billion U.S. dollars of homes in Zimbabwe and yet there are no mortgages on those homes,” Sharpe said at the ZimReal Conference. Drawing on economist Hernando de Soto’s work on undocumented assets, he added: “We’re paper rich, but very poor in the pocket.”

Sharpe said Zimbabwe could learn from countries such as Switzerland, where homeowners can borrow against property to finance businesses, education and other expenses. In Zimbabwe, much of that property wealth remains locked up because owners cannot easily borrow against it.

That shortage of financing is also a problem for WestProp, which needs buyers with access to credit as it expands its developments. In northern Harare, WestProp is developing Pomona City, a planned $4 billion district near Wingate Golf Club. Construction began last year on Pomona Flats, where one- to three-bedroom apartments start at $70,000.

Without mortgages, WestProp has turned to corporate employers and government agencies to buy blocks of apartments for their staff. The same challenge faces projects including Millennium Heights, Pokugara and The Hills Luxury Golf Estate, which is being built around an 18-hole championship golf course.

WestProp expands projects beyond Harare

WestProp is also looking beyond Harare. In March, its executives traveled to South Africa to seek anchor tenants for the planned $100 million Mall of Zimbabwe, which the company describes as Harare’s first enclosed, air-conditioned shopping center. Sharpe said retailers have shown interest but remain cautious about committing capital because of currency volatility.

In April, WestProp unveiled Chivhu Eco City, a 5,000-hectare project about 150 kilometers (93 miles) south of Harare along the Masvingo highway. The development includes plans for 20,000 residential plots and could provide an early test for the company’s proposed 30-year mortgage model outside the capital.

For Sharpe, 53, who began his career in food distribution in 1991 before moving into property in 2006, the mortgage business is closely tied to WestProp’s growth plans. If the $1 billion fund is raised, it could give more buyers a way to finance homes in a market where demand is high but mortgage credit remains limited.