Analysing the key factors contributing to the high mortality of real estate companies in Uganda

Abstract

The Ugandan real estate sector has experienced significant volatility, with a high rate of business failure among real estate companies despite the many opportunities in the country, such as growing urbanization and housing demand due to a growing population and vibrant economic indicators. This study aimed to analyse the key factors contributing to the high mortality rate of real estate companies in Uganda. As the research deployed a mixed methods approach by gathering significant information from literature review as well as preliminary discussions with relevant players in the real estate sector, such as real estate company owners and staff. A self-administered questionnaire was sent to respondents in order to bring out further factors or dynamics regarding the subject under study. The quantitative component involves the collection and analysis of data from a sample of real estate companies operating in Uganda over the past decade. Key performance indicators, including financial metrics, market share, and growth rates, are examined to identify patterns and trends associated with company failures. The qualitative aspect included in-depth interviews with industry stakeholders, including business owners, investors, and regulatory officials, to gather insights into the operational and strategic challenges faced by these companies. Findings revealed that inadequate access to financing, poor corporate governance, regulatory challenges, and economic instability are among the primary drivers of company failure. Additionally, issues related to financial and investment practices, weaknesses in project planning, low customer confidence, and limited technological adoption further exacerbate the situation. The findings of this study aim to provide actionable insights for policymakers, investors, and entrepreneurs to enhance the resilience and sustainability of real estate ventures in Uganda. By addressing the identified challenges, stakeholders can work towards creating a more conducive environment for the growth of the real estate sector, ultimately contributing to the broader economic development of the country. The study concludes with recommendations to enhance sustainability in the sector, including policy reforms, capacity building and training of both real estate owners and staff, and investment in financial institutions to offer long-term financing to the sector at a lower cost. The insights generated aim to inform policymakers, investors, and industry players seeking to mitigate business failure and strengthen the resilience of Uganda’s real estate industry.