The ultimate closure of USAID and why it might ditch the real estate market
Joran Buzaabo
What you need to know:
- It may be the right time for speculative investors to bring forth your dollars, ready to grab a very affordable property and hope for economic recovery after the elections
On Friday, 28th March 2025, the state department notified congress of the final closure of the USAID by July 1st 2025. This is the last nail in shutting the window of funding from this agency and a blow to those hopeful possible re-openings. According to business focus, Uganda received substantial amounts, including United States $930m in 2021, $503m in 2023, $510m in 2025.
When news broke on January 24, 2025, that President Donald Trump signed an executive order instituting a 90-day pause on all U.S. foreign development assistance, ordering “non-essential” staff to wind down, pack, and return home, it seemed a temporary window that would open sooner. This was followed by further curtailment on similar funding to the World Health Organisation.
This decision alone resulted in hotels receiving cancellations for planned conferences; car rental companies, contractors, and suppliers being put on notice to immediately pause any engagements in USAID-sponsored activities. Globally, the Trump administration said it will eliminate 5,800 of 6,200 multilevel USAID contracts to save $54 billion, and more 4,100 of 9,100 State Department grants to save $4.4 billion. This “wind down, pack, and return home” policy meant a substantial number of expatriates preparing to return to their home countries.
The landlords started receiving vacation notices, and those expatriate-owned properties have been put on sale. The locals who have been gainfully employed, local contractors, suppliers, and general service providers all have lost revenue. In Uganda, there is already a considerable number of properties on sale.
This trend is particularly concerning in upscale suburbs, where expatriate-owned and rented properties constitute a significant segment of the real estate market. Places like Munyonyo, Buziga, Muyenga, Kololo, Ntinda where most of the USAID-supported projects have been renting office spaces, and staff residences are already have several properties listed for sale, while more space is becoming more available for rent.
With this last hammer, returning expatriates must handsomely discount their asking prices to sell off and exit. In addition, the landlords would rather collect lesser rent than have unoccupied rentable properties, so this is slowly bringing prices low. The sudden loss of income for locals is putting a shock on their earnings, and we are likely to see more half-finished properties on the market.
The real estate sector's downturn is expected to ripple through the financial industry. As property values decline and rental incomes dwindle, property owners may face difficulties servicing their mortgages and loans. This situation could lead to a rise in non-performing loans, compelling banks to tighten lending criteria for real estate ventures. Such a credit squeeze would further stifle investment in the property market, creating a cyclical pattern of economic contraction. More properties may be auctioned due to nonperforming loans.
This spiralling effect is expected to fuel a myriad of ripple effects on schools, hospitality, tourism, and many other sectors. International schools are already seeing reduced numbers of enrolment, as children are going back with their parents. There are other factors at play, of course, including speculation on the forthcoming elections, especially by foreign investors on buying property.
It may be the right time for speculative investors to bring forth your dollars, ready to grab a very affordable property and hope for economic recovery after the elections to benefit from a stable market. With the right information on the market, during the coming months, it will be possible to buy a property at an incredibly low price.
Authored by Joran Buzaabo
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