The UN predicts that Sub-Saharan Africa’s urban inhabitants will more than treble in number to 1.1 billion by 2050, accounting for 56% of the continent’s population. By 2030 Dar es Salaam, Johannesburg and Luanda will have joined Kinshasa and Lagos as megacities, each with more than 10m people. The vast majority will rent a small home – buying is out of reach.
The Economist reports that it is no surprise that sub-Saharan Africa is the world’s smallest mortgage market. Just 3.7% of adults in urban areas had any type of home loan in 2011, according to a World Bank report.
For rural migrants, formal housing is unaffordable in most countries in this part of the continent. The cheapest new, privately-built formal house in Ethiopia cost $68,783 in 2013. A 100 square metre state-subsidised apartment sold for $16,600, 35 times the average Ethiopian’s earnings. “Even in Mali the cheapest legally-built private homes in the region, at $5,800 (plus another $1,000 to $4,000 for land, depending on location) are out of reach for most”, The Economist reports.
The value of Nigeria’s mortgages more than quadrupled between 2006 and 2011, but was still equivalent to no more than 0.5% of GDP, compared with more than 25% in South Africa.
Further reading on economist.com
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