This is the summary of an article by Vengai Madzima. It talks about the segmentation of three distinct markets in Zimbabwe with regards to the country’s real estate situation. The consumer market is diverse, and that each particular group has their own particular tastes and preferences.
Market segmentation is part and parcel of any business, regardless of type or size. A market segment is basically a “subset” of a larger population; it consists of groups or individuals that demand the same products or services. In the field of real estate, market segmentation plays a very important role.
The Case of Zimbabwe
At present, the real estate market in this Southern African nation is experiencing a lack of low-cost housing. This has resulted in high rental costs due to the high demand. Amidst these circumstances, three particular market segments stand out: students, the elderly, and low to middle income earners. Each segment has particular traits and housing needs, in relation to their age, status, income level, and other factors.
Affordable Housing for Students
The government of Zimbabwe pays significant attention to education. In addition, the local employment market is fairly competitive. Hence, it can be deduced that there is a constant demand for affordable student housing. In the past, some students opted to study abroad, but the current focus on supporting educational institutions will no doubt increase the number of students, and consequently the need for affordable education.
Accommodation for the Elderly
Another market segment worth looking into is the aged or ageing population. Previously, the elderly often stayed with their children and their families due to cultural norms. However, the times are changing and they are now becoming more independent, often no longer needing their children’s assistance to survive. Usually, they are hoping to live in a peaceful and secure place, and have access to basic services. Thus, housing created especially for them is essential.
Housing for Low to Middle Income Earners
One more market segment in Zimbabwe is the low to middle income group, who typically find it hard to buy a house in “one go.” Hence, a better option would be a “rent-to-buy” situation where they can initially rent, and then eventually buy, accommodation. This agreement is ideal for both the real-estate seller and buyer, who benefit from the investment.
In the case of Zimbabwe, students, the elderly, and low to middle income earners are examples of market segments in the real estate market. In each of these segments, their needs, capacity to buy, and other characteristics can be analyzed to come up with the right housing options.
These examples also show how different kinds of investments in real estate are possible, because of careful study of various market segments.