Housing Finance in Uganda


For the French version of this country profile, click here.

To download a pdf version of the full 2018 Uganda country profile, click here.

Uganda is East Africa’s fourth most populous country, and the fourth largest economy in the sub-region. The country is still largely rural, with over 75 percent of the population residing in rural areas. Uganda has a predominantly youthful population, with 47.9 percent of the country between 0-14 years of age and 49.2 percent between 15 – 64 years. Only 2.9 percent of the population is above 65 years.

Uganda’s economy has achieved a strong performance, with the growth rate increasing from 4.6 percent in 2017 to 5.2 in 2018. This growth has been attributed to high levels of public infrastructure developments and investment in a wide range of sectors, including housing and construction, manufacturing and the service sector. Moody’s credit rating for Uganda in March 2018 was maintained at B2, as a result of the country’s small economy, low levels of wealth; and an elevated susceptibility to event risk. Uganda’s economic outlook is however stable, reflecting a broad balancing of credit risks and expected gains from infrastructure investment alongside continued structural reforms in cooperation with the IMF.

Uganda’s financial sector has remained strong, resulting in the improved performance of financial institutions in 2017 and an increase in credit facilities extended to the private sector. Total lending in the local currency has risen by 7.4 percent from USh11 972 040 million in April 2017 to USh12 925 983 million in April 2018. Key recipients of this lending included: the building and construction sector, estimated at 21.0 percent of total credit outstanding; trade at 19.2 percent, personal credit at 18.3 percent, agriculture at 12.4 percent and manufacturing at 12.0 percent.

Uganda’s current housing stock is estimated at about 8 021 000 housing units with an average household size of 4.7 persons for the 37.7 million residents. Rental markets are dominant, particularly in urban areas. In Kampala, for example, over 71 percent of households rent their dwellings. Access to services continues to be a concern, even in the case of formal housing.

Uganda’s property markets are fast developing, particularly in towns adjacent to the main capital, Kampala. This has largely been as a result of large infrastructure projects aimed at catalyzing industrial development and economic growth, for example the construction of roads in Mukono, Wakiso and Mpigi. This conventional property market has however slowed in the 2017/2018 period, despite declining interest rates. With relative success in the lower-middle income segments, developers could be shifting to providing smaller units in coming years.

A number of key opportunities were apparent un Uganda, including the continued decline of general interest rates which reflected in reduced housing loan rates. Additional improvements in public infrastructure such as the completion of new hydroelectric power dams in Karuma and increased production of more cement will most likely combine to increase reach for greenfield housing projects on affordable terms. To complement these developments, however, lenders would need to structure affordable facilities in their product catalogues to maximize the latent demand for affordable housing.

Find out more information on the housing finance sector of Uganda, 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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