The real estate business is growing at a fast rate world over and Uganda is no exception. Many property agents and companies are coming up responding to the increased demand.
However, the more the demand the more such companies have emerged but some have failed to make it to their first birthday because real estate as a business has a lot of risks.
Nevertheless, with the existence of Mirembe Estate Sentema, many real estate companies can benchmark from it on how an estate can be managed, how to put up quality and super standard houses in a clean environment but sold at affordable prices as well as how to mitigate risks within the real estate business.
Speaking to Watchdog Uganda, Owen Elijah Isodho, the manager of Mirembe Estate Sentema says the issue of mitigation risks in real estate is a fundamental pillar that every real estate company must have.
“As a company, it’s usually advisable to have what we call a risk charter; this is a document that is made by the stakeholders within the business with experts who have knowledge about these risks. Or one can do benchmarking from other companies who are in real estate, for example, Mirembe Estate Sentema,” he advised.
Mr Isodho asserts that with the risk charter, a company is able to know what risks are likely to happen in the future and could be prevented because if they occur, they could actually damage the progression of the projects.
“So if one is to deal with risk, one must embrace the idea of insurance. When you insure, you are taking away the responsibility of a burden that would come to you, you are giving it to the third party. This is what we have done at Mirembe Estate Sentema and our clients are safe as well as the company because we have the insurance and security is 24/7 provided,” he said.
The manager added that insurances help a lot in the safety of the projects right from the construction until the house is finished and handed over to clients.
“When you are constructing, they are different challenges you may face such as theft; you have bought 100 bags of cement and 40 have been stolen, the insurance can always come in and reinstate you to the original level and then they will follow up with the investigation. This helps to save money, time and the project is not retarded.”
Mr Isodho, also noted at times real estate is challenged with employee turnover and in turn, companies are left with no experienced workers however he advised that can be solved by continuous training of workers to enable a uniform flow of information throughout the generation of employees that come and this is one of the central pillars that has made Mirembe Estate Sentema, a unique housing project.
On the risk of financing, he advised that any Real-Estate company desiring to succeed must at least not put all eggs in the same basket. In other wards, a company must have at least a side account to cater for challenges such as price fluctuations that were not budgeted for in the original plan of the project.
“Companies have come out with side accounts where they put let’s say 10 per cent of the total budget. Le’s say if our budget is Shs100m, we deposited 10 per cent of it in that side account. This money normally accounts for abrupt challenges like price fluctuations. Apart from that, we are also partnering with the bank, this is also necessary because they are a source of finances,” he said.
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