Should You Borrow to Buy Land?

In Uganda, land isn’t just mere property. It’s legacy. It’s security. It’s a sign that you’ve arrived, that you’re building something for yourself and the generations after you. Whether you’re dreaming of a home, starting a farm, or simply claiming a piece of earth for your children’s future, land is something many of us deeply desire. But what if you don’t have all the money right now? 

Should you go ahead and borrow to buy it?

It’s a question I hear more and more these days, especially as land prices continue to rise and banks, SACCOs, and moneylenders offer more loan options. And like many financial decisions, the honest answer is: it depends. It depends on your plans, your income, your financial cushion—and most importantly, the purpose behind the land you want to buy.

First, ask yourself: Why am I buying this land? If you have a plan to use it soon—maybe to build a home, start a business, or farm—it might make sense to take a loan. That way, the land can start working for you. It could help you save rent or even generate some income. But if your only plan is to “keep it for the future” without any clear next step, taking a loan might not be the best idea. You’ll have debt to repay, but the land won’t be helping you repay it.

Borrowing to buy land also comes with its own unique challenges. In Uganda, land loans are usually treated as higher-risk by lenders. That means you’ll likely need to raise a large deposit—sometimes 30% to 50% of the land’s value. On top of that, the interest rates tend to be higher than home loans, and you’ll also need to budget for extra costs like legal fees, land title transfers, surveys, and valuations. These extra expenses can quietly sneak up on you if you’re not careful.

Now, if you’re formally employed, there’s always the temptation to take a salary loan. These loans are quicker to process, don’t need collateral, and usually only require proof of steady income. They’re popular, especially when land deals are urgent or “too good to miss.” But they also come with a downside: shorter repayment periods and higher monthly deductions. That can put serious strain on your cash flow. If you’re already paying rent, school fees, or handling family responsibilities, adding a heavy loan repayment can quickly become overwhelming. Only go this route if the land is fairly priced, your job is secure, and you’re sure you can manage the pressure.

Of course, borrowing has its advantages. Land near roads, trading centers, or upcoming towns tends to appreciate fast. If you wait too long to save up, the price might double in a few years. Taking a loan now could actually save you money in the long run. Also, paying in installments through financing can help you hold onto some cash for emergencies—or even to start developing the land sooner.

But let’s also be real. Borrowing comes with real risks. If you miss payments, the lender can take the land back. And land in Uganda is not always clean and simple. Boundary fights, fake titles, and shady sales are not uncommon. If you’re going to borrow to buy, you must do your homework. Use a trusted lawyer, verify the title with the Ministry of Lands, and don’t skip any due diligence. The pain of losing money over bad land is worse than the pain of missing out on a deal.

Also take a good look at your finances. Do you have some breathing space in your income? Are you juggling other loans already? What happens if there’s a family emergency or your child suddenly needs school fees? Borrowing to buy land without a financial safety net can turn your dream into a stressful nightmare.

If taking a loan feels too risky, that’s okay. Many people simply choose to save slowly and pay cash. It takes more time, but it’s also more peaceful. Others come together as families or in small groups to pool money and buy land. Some land sellers are even open to installment plans without involving a bank. These options give you more flexibility without the pressure of interest or monthly deductions.

So, should you borrow to buy land?

Yes—if you know exactly what the land is for, the price is fair, and you’re financially stable enough to manage the repayments. Land is one of the few things in life that usually doesn’t lose value. But loans, on the other hand, come with deadlines and consequences.

If your income is uncertain or the land will sit idle for years, take your time. Save. Plan. Explore other ways. Because yes, land is a blessing—but only when it doesn’t steal your peace of mind.