Housing Finance in Mozambique


This profile is also available in French here.

To download a pdf version of the full 2023 Mozambique country profile in English click here,

Or in Portuguese click here.

Mozambique’s economic expansion promotes urbanization. a quarter of the world’s population because of its size. Mozambique lost income, jobs, and food security as a result of COVID-19. The growing number of young people raises housing demand. Jobless youth can benefit from public housing strategies.

Mozambique is increasing affordable housing to accommodate population growth, replace inadequate housing, and reduce slum housing. State funds built 4,000 units. The government has distributed 13,176 plots and 1,556 credit facilities for home renovation and expansion, but socioeconomic challenges and a humanitarian crisis are hindering these efforts. 950,000 people have fled Cabo Delgado’s conflict. This rapid influx has overwhelmed cities’ ability to provide urban infrastructure, services, and housing.

The Ministry of Land launched a $US6 million, five-year initiative to protect local livelihoods and increase climate-vulnerable coastal adaptability. The government wants the Housing Promotion Fund (FFH) to provide housing and develop the construction materials industry. In June 2022, inflation reached 10.8%, a five-year high. In response to inflation, the Bank of Mozambique raised its monetary policy interest rate. High interest rates and a $467 per capita GDP make formal housing finance unaffordable for most Mozambicans.

Most Mozambicans earn less than $100 per month in the informal sector. Most Mozambicans lack the disposable income to buy a home. Between April 2021 and March 2022, inflation averaged 6.7%. Starting in July 2022, civil servants will earn MT8,756 (US$137). Agriculture and forestry ($81) and construction ($105) have minimum wages.

Home loans are vital to Mozambique’s credit system and economy, according to the central bank. In June 2022, housing received 2.2% of bank credit (MT6.8 billion). Mozambique’s prime rate went from 18.6% to 20.6%. 15 banks offer mortgages.

Legal frameworks and regulations must be developed to support digital finance tools like housing finance and alternative credit scoring mechanisms that use mobile payments. Fintech could help close the gender gap in urban areas, where income levels are key for accessing financing. Climate-resilient materials and technologies can help develop the local building industry and skills.

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

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2023 edition, which has up-to-date profiles for 55 African countries.

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