Residential property rates increased across all surveyed areas in Greater Kampala Metropolitan Area, according to Residential Property Price Index.
The Index, compiled by Uganda Bureau of Statistics (Ubos), indicates that Nakawa registered the highest increase during the 2020/21 financial year.
Property prices in Nakawa, according to Ubos, increased by 13.4 per cent during the 2020/21 financial year compared to 4 per cent in the 2019/20 financial year.
This was the highest increase followed by Kampala and Makindye, which increased by 14.4 per cent compared to 7.3 per cent during the same period.
Ubos conducts surveys in the movement of residential property prices in Greater Kampala Metropolitan Area including in Wakiso, Kampala and Makindye, Nakawa, Kawempe and Rubaga.
Residential property prices in Wakiso increased by 7.3 per cent during the period compared to 2.2 per cent while Kawempa and Rubaga registered an increase of 10.4 per cent.
Residential property prices remain a sticky issues as property owners seek to make meaningful returns on investment amid an increase in taxes.
Government has already increased the rental income tax rate to 30 per cent. The tax took effect on July 1.
This has been exacerbated by a growing housing deficit, which currently stands at 2.4 million units, out of which 210,000 are in urban areas and 1.3 million in rural areas.
Available data also indicates that at least 900,000 units, which are already occupied, are substandard and in need of replacement or upgrading.
Globally, the housing market is closely linked to consumer spending.
However, this is contrary to the trends in Uganda that have continued to register an increase in residential property prices, amid subdued economic activity.
The economy had since March 2020 slowed down due to Covid-19 related disruptions that have seen growth decline to 3.3 per cent for the period ended June 2021.
According to Ubos, during the 2020/21 financial year, residential property prises roses by an average of 6.9 per cent compared to 6.5 during the 2019/20 financial year.
The increase is largely blamed on rapid growth in urban population that is not supported by sufficient planing.