Housing Finance in Zambia


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Zambia is a lower middle-income countrywith GDP per capita (current) of US$1 475.70,GDP growth of 3.9 percent and GNIper capita (Atlas method, current), of US$1 300.

In Zambia access to finance is not universal although the situation is improving. A 2015 Finscope survey found that 41 percent Zambians (approximately 39 percent men and 43 percent women) were financially excluded while59 percent (4.8 million) were financially included, exceeding government’s 50 percent target.An estimated24.8 percent (2 million) adults used bank services while 28.5 percent (2.3 million) used non-bank financial services. Approximately 6.5 percent of adults (0.4 million) belonged to some form of Savings Group (or Chilimba) while 12.5 percent (1 million) were members of Rotating, Savings and Credit Associations(ROSCAs).

There are 19 licensed and registered commercial banks with 329 branches and atotal loan portfolio of ZMW24.24bn ($2.4bn),as at March 2018, of which only ZMW816m (US$80.79 million) or 3.4 percent were directed to Real Estate, up from 2.3 percent in 2014. All commercial banksoffer home loan products at lending rates ranging between 24.6 percent and 35.8 percent.

Zambia’s housing deficit was estimated in 2012 at 1 539 000 units and is projected to increase to 3.3 million units by 2030. UN-Habitat has forecast a deficit of 1.3 million urban units by 2030, if no efforts are made to deliver at least 46 000 units per annum until 2030. According to the 2015 Living Conditions Monitoring Survey Report, there were just over 3 million dwellings in Zambia.

The residential property market is largely dominated by self-build homes, mainly for rent or owner occupation, with a small resale marketas most housing stock is informal and require upgrading to suitable standards.Demand for high-end quality housing, however, has stimulateddevelopment of modern housing clusters and gated communities. Private developers and individuals can obtain99 year leaseholds with no limitations and land is transferable. Government is reforming and streamlining the land administration system to make it more efficient and transparent for housing delivery.

Zambia’s property market is growing rapidly; attracting private equity and investment and proving to be a resilient and risk tolerant long-term investment destination. Thefocus on the high end of the housing market leaves a large gap in medium and low cost housing, an opportunity area for private investment.  Political economic analysis indicates a contentious and dynamic but generally stable political environment with several progressive policies, including the new National Housing Policy but little to show in form of implementation. The political will to overcome the housing deficit exists as reflected in Government’s effort to create 42 new districts, bringing the total to 115 districts.

 An opportunity exists to constructformal housing in these newly created districts. With over two-thirds of the total housing stock classified as informal, an opportunity exists to upgrade, improve housing standards and increasing both the quality and market value. Housing microfinance sector remains a huge growth area with huge potential in increasing affordable loans and mortgages for low and medium income earners and expansion of financial inclusion targeting the majority poor.

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