Housing Finance in Somalia


This profile is also available in French here.

To download a pdf version of the full 2019 Somalia country profile, click here.

The Federal Republic of Somalia is located in East Africa, forming part of what is referred to as the Horn of Africa. It is bordered by Kenya to the southwest, Ethiopia to the west and Djibouti to the northwest. Somalia’s population is approximately 15 million people, with 45 percent residing in urban areas. The 2018 National Budget Speech identified health, education, roads and agriculture as key priority areas for the country’s development.

Somalia’s financial sector is regulated by the Central Bank of Somalia, under provisions of the Banking Regulations Act of 2012. There are six banks licensed and operating in the country, and three of these offer housing/real estate/land and construction financing.

Access to adequate housing is an increasing problem in Somalia given the high urbanisation rate, exacerbated by IDPs seeking refuge in urban areas. According to Somalia’s National Development Plan 2017-2019, 14.7 percent of households in Somalia are IDPs living in informal settlements or camps. Eighty-five percent of the population live in slums or partially destroyed housing. Housing is mainly provided informally by individuals and typically lacks access to basic services such as electricity, water and sanitation.

According to the National Development Plan (2017-2019), land legislation in the country is outdated, and there is limited spatial planning or urban management. The plan also observes the lack of a clear land tenure system that synchronizes customary and formal land ownership systems. The plan proposes the need for a National Urban and Land Policy to address these issues.

Somalia has a range of opportunities, which provide an opportunity for growth and development. These include a relatively young population and potential workforce, a “vibrant private sector, a large diaspora willing to invest in the country, import substitution and export promotion (to target the trade deficit), nascent agricultural, agribusiness and fishing industries.

In Somalia, housing and housing-finance related data is extremely difficult to find, with the IMF indicating that data gaps are caused by institutional weaknesses, weak capacity, and poor data. Authorities have taken steps to address this by establishing the Somali National Bureau of Statistics, and the establishment of a new statistical law to parliament for consideration.

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

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2019 edition, which has up-to-date profiles for 55 African countries.

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Neighbouring Countries Djibouti Ethiopia Kenya
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