Editor, RE: "We need a study on real estate economics” (The New Times, December 16).

You have touched on an aspect of this equation: High property prices. My feeling is there is an artificially driven price increase of land, especially in Kigali, due to the master plan itself. The intrinsic value is probably a third current land prices.

On YouTube, there is a glossy video on the future of Kigali. Nothing is wrong with good promotions but it’s created "artificial” demand.

The current Muhima is slated for entertainment district with multi-storied buildings. The plot owner knows this well and based on this has hiked prices far above its intrinsic value. A developer has to buy the Muhima plot (including the cost of really old house only to demolish it later) at this "emotional” cost. If he is a speculator (again because it’s a high value target area), price increases even further.

High land prices, plus high cost of construction materials, and high interest rates push building costs to outrageous costs. This is where some interventions need to happen. Kigali Master Plan has to be revisited, in my opinion, to keep prices more realistic. OpenMG