Housing finance systems in developing countries have been the subject of considerable international agency research and lending attention in recent years. The lack of availability of finance for public sector housing prgrammes and for the purchase of construction of housing by all income groups in urban areas is typically a major constraint on the ability of supply to meet demand. However, national efforts have often not dealt systematically with the housing finance system as a whole. The housing finance system in Zimbabwe is described and critically analysed in this paper, paying particular attention to the provision of funds for local authority housing programmes for low income residents, the place of housing finance institutions in the national finance system, the ability of the building societies to attract savings, and their lending programmes. The results of government measures to transfer responsibility for lending to low-income households from local authorities to the building societies since the mid-1980s are evaluated. It is concluded that Zimbabwe has an unusually well-developed financial sector and housing finance system for a recently independent developing country. Although this evolved to meet the needs of the settler population, the extension of its activities into lending for low-income aided self-help housing was successful, within limits. However, events of the early 1990s demonstrate the vulnerability of such a system to the changes accompanying liberalisation. Suggestions are made for further possible reforms and the importance of monitoring the effects of economic liberalisation on the system and its beneficiaries stressed.
