The impact of the restriction of rent payment in Uganda shillings to the retail property market in Kampala

Abstract

This research analyses the impact of the restriction of rent currency to only Uganda shillings on the performance of the retail property market in Kampala central division. This is in regard to section 22(2) of the Landlord and Tenant Act, 2022. The research gives an analysis of the rent payment rates in various currencies, i.e. Uganda shillings and US dollars, for the many categories of retail businesses in Kampala central. The study also measures the acceptance levels of all stakeholders in regards to the new Act’s rent currency restriction, i.e., landlords, tenants, and property managers. The study then assesses the relationships between demand, supply, rent, and acceptance levels and lastly assesses the resolutions that can be adopted to ensure harmony between landlords and tenants regarding the rent currency restriction. Questionnaires, interviews, and reviews of existing literature are used to collect information concerning tenants, property managers, and landlords. The study comprises 134 respondents, 54 of which are tenants; 40 landlords; and 40 property managers. Non-parametric data analysis techniques are employed since the data is not normally distributed. The test of the only research hypothesis shows that rent currency restrictions to Uganda Shillings will have an impact on the performance of the retail property market. This is backed up by the respondents’ suggestions that rent for retail space will increase. The respondents are not sure, however, what will happen to supply and demand for retail space. It is recommended that major stakeholders be involved in the early stages of formulating a bill to cater for all interests. Further research into the Landlord and Tenant Act, 2022 is also recommended.