Last Updated:
Sep 12, 2006
Namibia is a large, sparsely populated country, which was once a German colony. It is a country of wide open spaces, deserts, an abundance of wildlife, a wealth of unique geological formation and unspoiled wilderness.
After World War II, South Africa took over Namibia (formerly named South West Africa). Independence only came in 1990, after a 25-year war.
Foreign land ownership is allowed in Namibia, except for agricultural land.
The white population is still a major player. About half of the 4,500 commercial farmers in Namibia are whites. Inter-racial reconciliation was an integral part of the early years of independence and has minimized migration of white Namibians to other countries.
Yet this is now becoming unstuck. In October 2005, the government expropriated the first white-owned farm, giving the owner about a third of the sum she asked for. Expropriation orders have been served on several other commercial farms.
The government aims to settle close to 250,000 landless people on white farms. But the government has promised that residential properties owned by foreigners will never be expropriated.
All this has not affected house prices in the capital Windhoek, which are still rising after years of strong growth. The FNB housing index rose 13.25% y-o-y to 1Q 2006, though the last quarter was soft.
Residential property prices in the capital, Windhoek, have increased by 90% since 2001. House prices in Namibia in general have risen more than 100% from 1993 to 2005, and 50% from 2001 to 2005.
After World War II, South Africa took over Namibia (formerly named South West Africa). Independence only came in 1990, after a 25-year war.
Foreign land ownership is allowed in Namibia, except for agricultural land.
The white population is still a major player. About half of the 4,500 commercial farmers in Namibia are whites. Inter-racial reconciliation was an integral part of the early years of independence and has minimized migration of white Namibians to other countries.
Yet this is now becoming unstuck. In October 2005, the government expropriated the first white-owned farm, giving the owner about a third of the sum she asked for. Expropriation orders have been served on several other commercial farms.
The government aims to settle close to 250,000 landless people on white farms. But the government has promised that residential properties owned by foreigners will never be expropriated.
All this has not affected house prices in the capital Windhoek, which are still rising after years of strong growth. The FNB housing index rose 13.25% y-o-y to 1Q 2006, though the last quarter was soft.
Residential property prices in the capital, Windhoek, have increased by 90% since 2001. House prices in Namibia in general have risen more than 100% from 1993 to 2005, and 50% from 2001 to 2005.
Read Price History »
RENTAL YIELDS
Last Updated: Nov 30, 2005
In Windhoek property typically costs US$457 – US$523 per sq. m. (NA$3,320 to NA$ 3,800). A 200 sq. m. house would cost about NA$712,812 (US$98,031). For a similar sized property, the rent would be around NA$5,643 (US$776) per month.
Yields are around 9.5% to 10% for properties of up to 200 sq. m.. Bigger properties have yields of around 7.5%.
Beachfront properties in Swakopmund are priced at US$131 to US$694 per sq. m. (NA$950 – NA$5,050), and yield around 5.5% to 9%.
Yields are around 9.5% to 10% for properties of up to 200 sq. m.. Bigger properties have yields of around 7.5%.
Beachfront properties in Swakopmund are priced at US$131 to US$694 per sq. m. (NA$950 – NA$5,050), and yield around 5.5% to 9%.
TAXES AND COSTS
Last Updated: May 11, 2009
Effective Tax Rate on Rental Income |
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| Monthly Income | US$1,500 | US$6,000 | US$12,000 |
| Tax Rate | nil | 6.4% | 8.0% |
| Click here to see a worked example | |||
Source: |
Disclaimer | ||
Rental Income: Rental and other income is taxed at progressive rates. Income above NAD24,000 (US$2,817) is taxed at 17.5%, while income greater than NAD200,000 (US$22,471) is taxed at 35%.
Capital Gains: There is no capital gains tax.
Inheritance: Inheritance tax is not levied in Namibia.
Residents: Residents are taxed only on their Namibian-sourced income at progressive rates, from 0% to 35%.
Capital Gains: There is no capital gains tax.
Inheritance: Inheritance tax is not levied in Namibia.
Residents: Residents are taxed only on their Namibian-sourced income at progressive rates, from 0% to 35%.
BUYING GUIDE
Last Updated: Mar 14, 2007
The total roundtrip transaction cost, i.e., the cost of buying and selling property, is around 9% to 16%. This includes the 8.05% agent’s fee (inc VAT) and transfer duties that range from 1% to 8%.To register the property nine procedures needed, and are typically completed in about 28 days.
Real estate transactions are negotiated and concluded in Namibian dollar (NA$). With strong links with South Africa, South African rand (ZAR) is accepted as legal tender in Namibia. The exchange rate is pegged at NA$1=ZAR1.
LANDLORD AND TENANT
Last Updated: Aug 14, 2006
Rent: All terms of lease agreements including rent and rent increases can be freely negotiated between the parties.
Effectiveness of legal system: Even if the court system is cumbersome and time consuming, the landlord is protected by an automatic rent interdict on the tenant’s movables. Such movables cannot be removed from the property, until judgment by the Court has been given.
Effectiveness of legal system: Even if the court system is cumbersome and time consuming, the landlord is protected by an automatic rent interdict on the tenant’s movables. Such movables cannot be removed from the property, until judgment by the Court has been given.
ECONOMIC GROWTH
Last Updated: Sep 12, 2006
Diamonds and democracy
Quality diamonds were discovered in 1908, which prompted an influx of Europeans, specifically Germans, eager to invest. The country produced 1.5 million carats in 2002, with export earnings estimated at $500 million. Other mineral resources in the country are uranium, copper, lead, zinc, gold, silver, tin, cadmium, semiprecious stones, tantalite, phosphate, sulfur and salt.Tourism revolves around ecotourism and attracts travelers from Africa, as well as Europeans.
The country’s politics is relatively stable and democratic. Presidential elections occur every five years, with each election considered fair and democratic by international observers despite minor irregularities. Like most Third World countries, an oversized bureaucracy slows down business and investment. Poverty and unemployment are high. HIV/AIDS remains a national priority.
The economy grew by an annual average of 3.8% from 1994 to 2005. Real wages grew by about 5% in 2005. Inflation was at 5.8% in 2005. The prime lending rate was 11.75%, lower than the 17% registered in 2002 and 24% in 1998.
