Gabon 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 Gabon is 2.6 percent, as of September 2016, and requires at least a three percent down payment. The cheapest newly built house by a developer recorded by CAHF is US$ 45 000, which is for a 150 square metre unit. Cement prices are slightly lower than the continental average, at US$ 8.59 for a 50-kilogram bag.
With an urbanisation rate of 2.5 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. There are several government-established organisations supporting the housing finance market, including a housing bank, housing guarentee fund, real estate agency and building soceity. 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 Gabon can afford.
Find out more information on the housing finance sector of Gabon, including key stakeholders, important policies and housing affordability:
- Access to Finance
- Housing Affordability
- Housing Supply
- Property Markets
- Housing Policy and Regulations
- Housing Sector Opportunities
Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2016 edition, which has up-to-date profiles for 51 African countries.Download yearbook
Gabon is a former French colony located on the west coast of Africa, bordering the Atlantic Ocean and Equatorial Guinea, Republic of Congo and Cameroun. The country covers an area of 267 667 km2 for a total population of approximately 1.7 million, with a third of them living in the capital city Libreville. The official languages are French and Bantou. The life expectancy in the country is at 62 years old. The climate condition of the country is mainly tropical, very hot and humid, with narrow coastal plain. Gabon is rich in mineral and natural resources which are petroleum, natural gas, diamond, indium, manganese, uranium, gold, timber, iron ore and hydropower.
Gabon is the fifth largest oil producer in Africa, and together with timber, and other mineral reserves they form the backbone of the economy. According to the World Bank report, in 2015, the oil sector accounted for 70% of export, 20% of GDP, and 40% of budget revenue. Nevertheless, the recent decline in the price of crude oil has affected the country’s future economic focus and it was forced to cut down its budget provision.
Gabon has made considerable improvement of its business environment and is currently ranked 162 out 189 countries globally. Regardless of the fact that, for the last four decades Gabon has experienced an increase in oil production, oil revenue did not translate into more job creation and poverty alleviation. The unemployment rate is above 21% due mainly to a weak education system.
For many years Gabon has maintained a relatively calm political and security situation, especially during President Omar Bongo’s reign, the country was considered one of the very stable countries in sub-Saharan Africa.
Access to Finance
Gabon forms part of West African monetary zone called CFA Franc. The financial sector in Gabon is made up of the Gabonese Development Bank (BGD) and eight commercial banks. BGD’s main role is to lend money to small and medium-sized companies. Citigroup a US bank also has a representation office in Gabon1.Corporate services are offered by commercial banks however, corporations operating in the country have the freedom to contract credit from outside the country. In addition, local credit is available to both local and foreign investors on equal terms. Nevertheless, the country’s main economic factors such as oil companies are financed from outside the country.
Gabon’s housing finance program and budget are divided between different state institutions that have the mandate to deliver and execute housing programs in the country. These institutions are namely: the Ministry of Housing; the Agence National de Grand Travaux (ANGT) and the National Real Estate Company which is a government body that was created in 1976 with the aim to develop and oversee housing projects. Today the government retains 70% of the stake of the National Estate Company. Additionally, the Gabon National Housing Fund (NHF) created in 1973 and the National Building Society (SNI) created in 1976 by merging the National Housing Corporation and the Gabonese Development of Real Estate and Equipment. In addition Credit Foncier of Gabon (CREFOGA) is established by the Gabonese government as a specialized agency in housing finance. Another financial government institution is the Guarantee Fund for Housing (Fonds de Garantie pour le Logement, FGL). The FGL has the administrative and financial distribution mandate to deal with housing deficit. The government of Gabon has also established the housing bank, which is commissioned to provide loans at all steps of the housing construction and sale process.
Today, there are a number of financing mechanisms in Gabon that have been identified through the National Infrastructure Master Plan in order to facilitate real estate investment, public-private partnerships, and built operation transfer cession as well as fully control private projects. There are also private banks and credit institutions operating in the housing sector with the aim to stimulate and provide finances to real estate developers and new home buyers. Public servants have access to financial institutions and in the last five years the government has put in place a housing scheme to finance low income earners.
The housing budget in Gabon is divided between the Housing department, the ANGT, and the National Real Estate Company known as Societe Nationale Immobiliere (SNI) a government entity that oversees all housing development projects across the country. In addition, the Guarantee Fund for Housing (Fonds de Garantie pour le Logement) is also a government institution that plays the role of housing finance deficit and provides loans at every step of housing development and sale processes.
The majority of Gabonese lives in urban center 70% and the government is the largest formal employer in the country. However, Gabon poverty rate is very high 30% of local populations are vulnerable and living with a monthly income of minimum wage of US$ 319.6. More so, many local community/residents do not have access to basic services such as safe drinking water, electricity and health care in more than 65 of the regions. Due to the high cost of living, the majority of local communities cannot afford to finance the construction of their houses via existing financial channels. This is because, the cost of construction materials are very high. In addition to the high cost of construction materials, an average monthly rental for a standard two bedroom house in urban centre is about US$ 350 that is out of reach for many civil servants and unemployed local community. As a result, majority of local communities in urban area such as Libreville and Portgentille end up living in houses built with low cost materials (sun-dried bricks made of clay and hood) in townships in and around the urban center without proper title deeds.
In attempting to address this matter and reduce the inequality gap, the Plan Strategique Gabon Emergent (2012) was created so that new innovative ways will help diversify and develop new industries. These industries include transformative industries, infrastructure development, and building smart cities that will respond to housing needs and also adhere to sustainable development principles. However, as a result of decline in oil price and national budget cuts, delays in development projects have increased.
At present, the majority of major social housing developments are led by the international companies mainly from China and India to build affordable social housing for public servants.
The housing backlog for Gabon is estimated to be between 50 000 and 170 000 respectively for the cities of Libreville and Portgentille especially for affordable social housing. However, this situation could improve with new government financial strategies and help through better regulations and facilitating access to land titles.
According to the National Infrastructure Master Plan (2011) action 152, the government plans to build 35 000 houses with the aim of significantly increasing housing supply and to facilitate access to mixed used housing. The project aims to build and deliver to the country on average, 5 000 units annually, in order to encourage social diversity, vertical and horizontal densification.
The materialization of the National Infrastructure Master Plan (2011) housing delivery vision is currently under way in the peripheral area of capital city Libreville. One of the projects that have already started is the new urban development project called Angondje Development District located in the west part of the capital city. With this project the government aims to allocate 5000 registered plots annually with title deeds to identified private developers in the housing sector. The objective is to facilitate housing market access to public servants such as teachers, health personnel, army etc.
The national agency for public works of Gabon is also involved in the redevelopment and revitalisation projects in certain areas around Libreville. One of the revitalization projects is called the revitalization of the port Mole area with the aim to transform the area into a centre of urban life. This project involves the refurbishment of the marina area with public and recreation centre space, commercial and leisure space, restaurant and hotels. Most of redevelopment projects will also have a consequence on housing demand in the area or surrounding for people desiring to leave in close proximity to job opportunities and place of work. Hence, within the Mole precinct, the government is planning to develop major road/boulevards along which mixed used building projects which will also take place for commercial and residential use.
In spite of rapid urbanisation that the country has experienced in the last decade, Gabon’s real estate market has remained underdeveloped and characterized by high-end sales and high-priced rentals as key drivers followed by demands for social housing . Much of the housing development, property demand and infrastructure development in the country has been driven by the hosting of the Nations African football tournament despite the growing challenge/needs for social housing for poor communities and low-income earners.
Hauts de Gué-Gué and La Sablière and Batterie IV are the more successful and better quality property developments located around Libreville. Demand for high quality residential property is also on the rise due to competition demands between private and corporate occupiers; this has consequently increased the rental prices. In addition, there is an increasing demand for retail and office buildings in the country, with state institutions and international institutions being the main dwellers/users.
The average rental rates in Gabon are as follow in and around the capital city of Libreville:
- Apartment (1bedroom) in City centre US$ 1 375
- Apartment (1 bedroom) outside city centre US$ 425
- Apartment (3bedroom) in city centre US$ 3 300
- Apartment (3bedroom) outside city centre US$ 860.
Housing Policy and Regulations
Gabon’s current economic policy and regulations focus will be driven with the objectives to transform Gabon into an “emerging” economy. This approach is to improve investment in other sectors so dependency on the oil sector can be minimal. The 1998 investment code notes in accordance with the Central African Economics and Monetary Community (CEMAC) investment regulations, that the country provides the right to foreign and local companies to operate in Gabon. However, a certain number of strategic business sectors such as mining, forestry and petroleum are organised under a specific investment code based on customs and tax incentives. In order to increase transparency in its recourse and mining industry, the country is in the process of introducing a new mining and petroleum code. Gabon has also adhered to the Organisation for the Harmonisation of African Business Law (OHADA) an organization for business harmonization in Africa which allows foreign investors to choose without restraint from a wide range of legal business structures such as private limited liability company or public limited liability company.
The Gabon Constitution of 1991 acknowledges the right to housing for every Gabonese citizen in its Article 1.
The closest form of land policy was dated back from 1911 which still form part of the land legislation. The policy states that most of the land belongs to the government, and there is no proper existing cadastral plan in some parts of the country beside the capital city Libreville. No formal system exists for the transfer of title deed/land ownership, which keeps poor communities in poverty as it can prevent those without proper land/property ownership from trading in a formal business. This also hinders access to credit due to lack of registered property and secure tenure. As an attempt to overcome this situation, the National Infrastructure Master Plan (2011), under Action 146 plans were created to reinforce the legal framework for the construction and housing sector. Additionally, this plan aims to create a legal framework and incentive in order to facilitate access to private property development and construction activities by defining and putting in place clear rules and regulations. This new regulation focuses on a law for real estate development, decree on operational conditions of the property development as a business, a decree on the conditions of access to the property development business and the renewal of professional developers’ card and a convention relating to benefits granted to developers for the completion of social housing.
In Gabon social housing projects are driven by the high rate of urbanisation and the fact that almost half of the country’s population lives in the capital city Libreville. Therefore, a program is to take place under Action 153 of the National Infrastructure Master Plan (2011) called Restructuring and slum upgrading. This program will involve restructuring and relocation of residents from precarious neighbourhood to new urban centres with suitable accommodation and social infrastructure. This approach will promote access to land and social facilities as well as social services to local residents. This new development is supposed to take into account all different categories of social life and income.
Housing Sector Opportunities
Gabon offers many business and financial opportunities for investors regardless of its small population. The country has one of the highest GDP per capita in Africa which is an advantage for investment in the country. In the last decades it has attracted and continues to attract French retailers such as Carrefour, super markets and Casino. In addition there is a new Grand Marche under construction on a seven hectare land by the Swiss group Webcor in Libreville with big capacity and will surpass the existing main market of Mont-Bouët.
Up until recent years Gabon has enjoyed a relatively stable economic relationship with its former colonial power. However, due to changes in the global economic arena, Gabon has broadened its economic and diplomatic partners to other emerging powers form Asia and Africa who have the ability to bring in the country money and expertise to boost the country’s economy away from oil dependencies.
In order to keep up with its housing delivery program, the government is engaging in a number of reforms to try and stimulate the housing sector. Among these reforms is the alleviation of administrative and regulatory obstacles that were hampering social housing delivery projects. Institutional reforms are also taking place in the housing sector which includes the creation of new specialized housing agencies, the establishment of several new institutions such as the National Agency for Urban Planning, Topographical Works and Land Registry called (Agence National de l’Urbanisme, des Travaux Toppographique et du Cadastre – ANUTTC) with the mission to plan and oversee all land and real estate development projects, maintain and extend the national land registry and facilitate the purchase and transfer of property units.
In 2012, Gabon also introduced a new system of ‘guichet unique’ with the aim to simplify the procedure of land purchase and reduce the time to acquire a title deed from the initial 10 years to 180 days, and reduced administrative steps from 134 to seven. Hence, one of Gabon’s priorities is to increase the house stock as stressed in the National Infrastructure Master Plan of 2011 launched in June 2012. The budget for the housing development projects identified in the master plan for the period between 2011 and 2016 is estimated at €2.23 billion; part of this money will come from the public sector, the private and foreign investment.
In addition to the Angondje District Development project, there are also other similar projects in the pipeline with the same approach and addressing the same issues with the same standards. These projects are Nkoltang located on the Route nationa 1 situated 5 km east of Nkok. The other urban district project in the pipeline is the Lambarene situated in the river transport hub and the aim of this project is the construction of 1 000 units. Another, housing program that the government is planning to implement as announced by the government in 2012, is the construction of 5 000 houses to take place in Esterias 30 km north of Libreville and will be financed by the Gabon government through Gabonese Development Bank (Banque Gabonaise de Development).
Gabon has shown signs of commitment to finance housing projects though alleviation of regulations and financing housing projects. Private investment in development projects is also expected to increase gradually for the next 20 years due to political will and government commitment to make the country an “emerging’ economy. However, one of the biggest challenges remains the affordability and accessibility to housing/social housing for low income earners/poor unemployed communities that still unclear.
There are a number of foreign companies that are already operating in social housing developments projects as noted by BHG’s Ondounda that “there is great potential in housing as there are a lot of real estate developers and construction companies seeking to promote and develop their activities in Gabon which include local small and medium-sized enterprises as well as foreign companies that have recognized the opportunities presented by the Emerging Gabon Strategy”.