Housing Finance in Benin


Benin is a small country in the West African Economic and Monetary Union (WAEMU). For years, agriculture has been the main driver of the economy through cotton exports, which account for over 40 percent of export revenues. Over the past three years, GDP growth has been driven by an increase in agricultural production and in activities at the Port of Cotonou, resulting from modernisation works undertaken under the Millennium Challenge Account Programme. The World Bank’s 2017 Doing Business Report ranked for the second consecutive year Benin among the top 10 reformers in the world, with an overall
ranking 155th out of 189 economies on the ‘Ease of doing business’ global index.

Benin has a growing housing finance sector. As the mortgage market does not yet meet the breadth of the population who might afford a mortgage, most households still finance their housing independently, with savings or non-mortgage credit.

The lowest recorded interest rate on a mortgage in Benin is 8.47 percent, as of September 2016, and requires at least a 30 percent down payment. There are currently an estimated 539 mortgages in the country, with the average mortgage size being US$ 8 394. The cheapest newly built house by a developer recorded by CAHF is US$ 14 941, which is for a 40 square metre unit. Cement prices are lower than the continental average, at US$ 6.30 for a 50-kilogram bag.

With an urbanisation rate of 3.62 percent, demand for affordable housing will remain strong, both for rental and purchase. Housing microfinance will play an important role in increasing the supply of housing, and efforts to increase access should be undertaken. Lending rates in Benin are among the highest in UEMOA, and difficulty accessing title constrains the the housing market; banks have the option of accessing refinancing through Caisse Régionale de Refinancement Hypothécaire de l’UEMOA since 2012. With a good macroeconomic environment, sound policy, better data and increased access to affordable credit, an enabled housing market can increasingly provide housing that the average household in Benin can afford.

Find out more information on the housing finance sector of Benin, including key stakeholders, important policies and housing affordability:

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2018 edition, which has up-to-date profiles for 54 African countries.

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