Housing Finance in Rwanda


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Rwanda’s 2017 GDP was estimated to be 6.1 percent higher in real terms than in 2016, with the GDP per capita increasing from US$735 in 2016 to US$774 in the same period. The economic growth rate is projected to be 7.2 percent in 2018 by the International Monetary Fund (IMF). This growth has been driven by the services and agriculture sectors, with real estate activities contributing 8 percent of GDP.

Rwanda’s local finance sector comprises of 11 commercial banks, 4 microfinance banks, one development bank and one cooperative bank. The country also has a large number of MFI’s which include limited liability companies, savings and credit cooperatives (SACCOs) and Umurenge-SACCOs. These are complemented by non-bank financial institutions which include 16 insurers, a public pension scheme offered by the Rwanda Social Security Board and 62 voluntary occupational pension schemes.

A key housing affordability concern is the high discrepancy between local incomes and the cost of housing. Over the years, however, construction costs in the country have been on the decline, with the cheapest formal house in the market currently estimated at US$20 000. Policy initiatives to make housing more affordable – at a wider scope – have included: cost-efficient design, construction and construction management; increased availability of materials; decreased unit sizes and floor area per person; use of technologies and design skills which lower construction cost; and facilitation of households to co-locate with economic opportunities.

State policies and incentives from 2015 have attracted affordable housing investors, with government-subsidised housing developments having approved 600 units. In the coming years, an additional 4 500 units are to be developed via the Development Bank of Rwanda (BRD) with 20-30 percent equity participation.

Rwanda is currently ranked 2nd out of 190 economies on the ease of registering property in the Doing Business Indicators. Registering property in Rwanda now only requires a three step-process, has reduced to seven days and costs 0.1 percent of the property value. This is a result of amendments through the Ministerial Order Determining Urban Planning and Building Regulations and the Ministerial Order Determining Building Permits for more efficient permit processes. Additional measures included the development of an online building permitting platform, which was first spearheaded by the City of Kigali and is now also operational in the secondary cities, with countrywide access to be rolled out by 2024.

Some key opportunities in Rwanda include a proactive and innovative policy regime that intends to address the housing challenge by developing housing finance systems and solutions to collectively carry risks and ensure that majority of the population receives an opportunity to improve their socioeconomic circumstances. Additional work is planned to complete and harmonise fiscal, monetary and tax policies to enhance household incomes by increasing employment opportunities, domestic productivity and the production of building components and materials. Key opportunities exist in the development of formal rental housing and the integration of real estate management components into the sector. Although these have been partially addressed in the Condominium Law from 2010, additional regulations for real estate management are still needed. A number of sites exist in Kigali and surrounding secondary cities for the development of high-density mixed-use housing through the districts.

Find out more information on Rwanda’s housing finance sector, 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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