Founder’s letter  ·  October 2026 · No. 03

Uganda Shilling at 4,000: Why Apartments Beat Treasury Bills Now

The shilling just crossed 4,000 to the dollar. Here is what it means for your treasury bills, your land, and why Kampala apartments hold value.

HR
Hakiza Ronald
Founder and CEO · Kampala
10 min read

The day the Governor told us, and the day it came true

On 28 April 2026, the Governor of the Bank of Uganda stood before Parliament and said something central bankers almost never say out loud.

"We are going to have a substantial depreciation of the currency."

He was speaking about the Protection of Sovereignty Bill. He warned our Members of Parliament (MPs) that it could choke the money flowing into the republic of Uganda: foreign direct investment, portfolio money, and the remittances our people abroad send home every month. He said our reserves, close to $6 billion, were built on those flows. Then, he added salt to an injury by stating a quote that is now credited to his name and should be framed on every Ugandan's wall.

A country without reserves is not sovereign.

Most of us heard it on the news and went back to work.

On Monday, 5 October 2026, the shilling traded at 4,025 to the dollar. It had never been there before. Not even the 2011 election madness that has seen Uganda print insane amounts to keep up with election, had seen this kind of depreciation. For the first time in Uganda's history, one dollar costs more than four thousand shillings.

But let's look at the data very well.

Uganda shilling exchange rate: what it lost since April

When the Governor spoke, a dollar cost about UGX 3,720. On 5 October it cost UGX 4,025 at its worst and settled near 4,018 on the Bank of Uganda's own quote. That is about 8% more shillings for the same dollar in just over five months. Put the other way, every shilling you hold has lost about 7.5 percent of its dollar value since that speech.

The slide was not only about the Sovereignty law, which Parliament passed in May. Oil prices, heavy end of year import demand and offshore investors pulling out of our bonds all pushed the same way. Uganda's shilling is now Africa's second worst performing currency of 2026, down about 10 percent this year, behind only Ghana's cedi.

Treasury bills and bonds in Uganda: where the money is hiding

In that same speech, the Governor revealed something more. Foreigners hold close to $3 billion of Uganda government securities. That is about 12 percent of everything the government has issued.

Twelve percent. Money from people who do not live here, do not vote here, and owe this country nothing.

They came because our yields were fat. A one year treasury bill in Uganda paid near 15 percent at the end of 2025. Then the world shook. When strikes on Iran rattled markets early this year, offshore holders began dumping Ugandan bonds within days, turning shillings into dollars and walking out the door. On 1 October, dealers again pointed at offshore investors unwinding bond holdings as a reason the shilling broke to new lows.

That is the nature of hot money. It does not knock when it leaves.

And behind the foreigners stand the rest of us. Banks, pension funds and the central bank held nearly two thirds of the bond market by late 2025. Thousands of ordinary Ugandans, teachers, doctors, traders and people in the diaspora, have learned to buy treasury bills and bonds through their phones. It feels safe because well, the government always pays.

But the problem is, the government pays you in shillings.

Why your treasury bill returns shrink when the shilling falls

Let me use basic English to explain this in a way that might make sense to an ordinary Ugandan in regard to this shilling depreciation.

Let’s say you put UGX 100 million into a one year treasury bill on the day the Governor spoke. Recent 364 day bills have cleared at roughly 11.5 to 12 percent. After 20 percent withholding tax, you keep about 9.5 percent a year. In the five months since April, that is roughly 4 percent, about UGX 4 million.

Imagine 4% on your investment. It gets worse if you ask, “what your money can buy.”

On 28 April, your UGX 100 million was worth about $26,900. Today it is worth about $24,900. The currency quietly took roughly $2,000 from you, more than the interest gave you. Your statement says you are up. Your purchasing power says you are down.

Now look at what you buy with shillings. Annual inflation rose to 4.6 percent in September. Diesel inflation hit 42.5 percent year on year. Petrol, 30.9%. Every litre of fuel that moves cement, steel, glass and tiles to a building site in Kira or Najeera now costs more.

Paper promises are paid in paper. When the paper weakens, so does the promise.

So should you really keep your money in one type of currency while that currency is sliding??

Let’s explore more.

Why real estate investment in Uganda holds value when the shilling falls

An apartment does not care what the dollar did on Monday.

It is just concrete, steel and glass put together into a structure that pays cashflow while also appreciating in value. It is a roof over a family that pays rent on the first of every month. When the shilling weakens, everything it takes to build that apartment again gets dearer such as the imported steel, the glass, the fittings, the fuel in every truck. An apartment that already stands is suddenly cheaper than the one that has not been built yet. That gap does not stay open forever because prices walk up to meet it.

The official numbers show prices walking, not running. The Uganda Bureau of Statistics says residential property prices rose 3.5 percent in the year to September 2026 which is honestly slower than before. However, this tells you the replacement cost of an apartment is climbing faster than its selling price today. That window is where patient owners make their money.

Then there is rent. Rent is the treasury bill that does not expire. A one bedroom apartment in Kampala earns every month, and rent is renegotiated as the cost of living moves. Furnished short stay apartments do even better in a weak shilling season, because the visitors who book them earn in dollars, pounds and euros. When their currency buys more shillings, Kampala becomes a bargain to them.

And for the Ugandan abroad, this moment is a gift. The same $500 you send home this month buys more of an apartment than it did in April. Diaspora investment in Kampala property just got about 8 percent cheaper.

A treasury bill pays you in depreciating currency while an apartment pays you in something people cannot live without.

A classic Vestafi case: two neighbours, one shilling

Picture two neighbours in Kampala. Both might have the same salary, same discipline and in April, both decided to stop letting their money sleep.

The first one chose treasury bills where every quarter she rolled them over and watched the interest land. Today her statement shows growth and yet her landlord, her fuel station and her children's school fees show something else. She is saving in a currency that has lost about 8% against the dollar since April 2026, and she owns nothing she can stand inside.

The second one joined Vestafi.

She picked a goal on the Vestafi platform: a one bedroom apartment in Kampala, valued at around UGX 200 million. She contributes toward it every month, from her phone, the way the other neighbour buys bills. When her goal is met, a condominium title is issued in her name. Not a certificate of paper. A title to an apartment, with a door, keys and a tenant.

While she builds toward it, she is not alone. She sits inside a society of Ugandans at home and abroad who own apartments together, learn together, and refuse to be poor together. Vestafi finds the apartments, furnishes them, manages the tenants, collects the rent and keeps the books she can see in her own dashboard. Some of those apartments run as furnished short stays, earning from visitors who pay in stronger currencies.

When the shilling fell this week, the first neighbour checked the exchange rate. The second checked her apartment. One of them felt fear. The other felt ownership. The one inside Vestafi society felt more happy and rich. The other is worried.

That is the whole difference. It's more pathetic that our education system ignores such crucial information and instead focuses on teaching you the parts of a cockroach.

What is the best investment in Uganda right now?

The Governor told Parliament the truth in April 2026 and then the market confirmed it in October. Nobody can promise you where the shilling goes next. The Bank of Uganda says it has the tools to steady it, and it may well do so. But a wise person does not bet their whole life on one currency holding still.

Our grandparents knew this without a single economics lesson. They kept wealth in things such as cattle, land, and a house. In retrospect, these things fed them when money failed, which was their version of ‘cash flow’. The modern version of that wisdom is a condominium apartment that pays rent.

You can keep watching the dollar rate in Uganda every morning or you can own something that does not need to be watched.

Vestafi is where Ugandans who chose the second path are building, one apartment at a time. Find it, ask how it works and then decide where you want to be standing the next time the shilling moves.

Frequently asked questions

What is the dollar rate in Uganda today? On 5 October 2026 the shilling traded as weak as 4,025 to the US dollar, its weakest level on record, before settling near 4,018. Check the Bank of Uganda website for the daily official rate.

How much has the Uganda shilling fallen in 2026? About 8 percent against the dollar since late April 2026, when it traded near 3,720, and roughly 10 percent since January.

Are treasury bills still a good investment in Uganda? They are safe in shilling terms and still pay double digit yields. But after withholding tax and a falling shilling, their real value in dollars can shrink. Many people now keep part of their savings in real assets like apartments.

Is land or an apartment a better investment in Uganda? Land pays only when you sell it. An apartment pays rent every month while its value follows building costs upward. In a weak currency season, an apartment gives you both income and a hard asset.

How can I invest in Kampala property from the diaspora? A weaker shilling means your foreign earnings buy more in Uganda. Through Vestafi, you can work toward owning an apartment in Kampala from anywhere, track it on your phone, and have it fully managed on the ground.

Sources

Hakiza Ronald

Founder and Chief Executive, Vestafi

Read the record →Letters from the founder. A new entry on the first of every month.