Housing Finance in Somalia
Overview
This profile is also available in French here.
To download a pdf version of the full 2023 Somalia country profile, click here.
Somalia has a population of 15.8 million people, with rural areas accounting for 60% of the population. Urban housing supply isn’t enough to meet rising housing demand or close the two million-unit housing gap, which is getting bigger.
Somalia’s GDP in 2020 was $7,628 million, with a per capita income of $502, rising 2.9% in 2021. The recovery from the COVID-19 pandemic increased GDP and per capita spending by 1.1%. Almost 70% of the population has a daily income of less than $1.90.
Access to financing or credit is a key stumbling block for most people in Somalia who want to build or buy a property. Because the government hasn’t put much effort into regulating housing, the private sector has taken over the housing market, the construction industry, and the property development market.
As more Somalis are displaced annually, the demand for affordable housing increases. The high prices of property in the city centre, which are driven by insufficient supply and rising demand, demonstrate this.
In order to make affordable housing better able to deal with the effects of climate change, new building technologies that make it easier to adapt to its effects must be researched and used.
Find out more information on the housing finance sector of Somalia, including key stakeholders, important policies, and housing affordability:
- Overview
- Access to Finance
- Affordability
- Housing Supply
- Property Markets
- Policy and Legislation
- Opportunities
- Green Applications for Affordable Housing
- Availability of Data on Housing Finance
- Additional Sources
- Websites
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 and territories.
Download yearbookSomalia
Overview
Somalia is inhabited by 15.8 million people 60% of whom live in rural areas, with an economy that mainly relies on agriculture.[1] Three consecutive periods of drought has displaced hundreds of thousands of Somalis and left them without water and food, with climate change flagged as a major contributing factor to this humanitarian crisis. In addition, the ever-increasing number of internally displaced people, the rise in oil prices, conflict, and dependence on importing building materials are all hurting the local economy. Food security and the basic need for shelter and access to services are of particular concern.
Housing supply does not meet the ever-increasing housing demand or cut into the existing (and increasing) I housing deficit of two million units.[2] Housing developed by the private sector is too expensive for most Somalis. Access to affordable housing is limited and constrained by location. Compared to rural areas land and housing in urban areas is scarce .[3] Urban land and housing in urban areas is also much more expensive than rural areas, with land values highest in Mogadishu, the country’s capital city. It is estimated that since 2012, land prices have increased as much as tenfold.[4] Added to the housing deficit, at the end of 2021 the country had just over 3.5 million refugees, internally displaced households (IDPs) and asylum seekers, including approximately 550 000 return IDPs. Half of IDPs are women and only half of IDP camps have access to water.[5] Furthermore, a three-year long drought has displaced more than one million Somalis since the beginning of 2022, resulting in a hunger crisis. More than 3 400 IDP sites nationally were reported at the end of July 2022.[6]
Somalia’s Gross Domestic Product (GDP) at current market prices in 2020 was US$7 628 million and US$502 per capita, increasing by 2.9% in 2021. [7] Higher GDP is largely due to the recovery from the COVID-19 pandemic, with a 1.1% increase in per capita consumption of non-food items and an increase of household final consumption expenditure of 3.9%.[8] Somalia remains heavily reliant on imports at 86% of GDP. The annual inflation rate increased from 4.11% in 2020 to 4.63% in 2021.
A Country Preparedness and Response Plan (CPRP)[9] was developed in late March 2020 to tackle the public health, humanitarian, and socio-economic consequences of COVID-19. The plan identifies IDPs, the elderly, and the urban poor as the most affected and at-risk population groups. The Somalia Humanitarian Response Plan (HRP) 2022 was issued in December 2021 with the goal of reaching 5.5 million to reduce the loss of life, provide access to livelihoods, and monitoring environmental protections.[10] According to the HRP, in November 2021, government declared a drought emergency as the three consecutive seasons of drought left the country in dire need of assistance.[11] The HRP requires US$1.468 billion to meet the needs identified and has indicated housing, land, and property as key areas of focus for 1.3 million people concentrated in areas of conflict and IDP settlements.[12] The COVID-19 pandemic continues to test Somalia, but it is benefitting from the COVAX programme supporting the procurement of vaccines, with over 3.7 million doses donated by other countries as of 2022.[13]
[1] Climate Change Knowledge Portal (2022) Climate Change Overview – Country Summary: Somali https://climateknowledgeportal.worldbank.org/country/somalia (Accessed 09 September 2022)
[2] Amal Real Estate (2017) Overview of Real Estate in Somalia.https://www.amalrealestate.so/uncategorized/overview-of-real-estate-in-somali/ (Accessed 9 September 2021)
[3] The World Bank (2019) Somali Poverty and Vulnerability Assessment: Findings from Wave 2 of the Somali High Frequency Survey. https://openknowledge.worldbank.org/bitstream/handle/10986/32323/Findings-from-Wave-2-of-the-Somali-High-Frequency-Survey.pdf?sequence=1&isAllowed=y (Accessed 8 September 2021)
[4] Willenberg, T. (2017) in Immediate Protection of Public Land & Property: Steps for Strengthening of the FGS Management of State Assets, report commissioned by the Financial Governance Committee (FGC) of Somalia’s Ministry of Finance. Pg. 1.
[5] United Nations High Commissioner for Refugees (2022). CCCM Cluster Somalia. https://reliefweb.int/report/somalia/cccm-cluster-somalia-dashboard-july-2022 (Accessed 31 August 2022)
[6] Ibid.
[7] The Federal Republic of Somalia (2022). National Bureau of Statistics: Somalia Gross Domestic Product, 2022. https://api.nbs.gov.so/wwwroot/Statistics/b3815f95cd2246f3a8516ebd33c4eb32.pdf (Accessed 31 August 2022)
[8] Ibid.
[9] United Nations (2020). Somalia Country Preparedness and Response Plan COVID-19.
[10] United Nations (2021). Humanitarian Response Plan Somalia. https://somalia.un.org/sites/default/files/2021-12/2022_Somalia_HRP.pdf (Accessed 1 September 2022). Pg. 5.
[11] Ibid.Pg. 9.
[12] Ibid.Pg. 14.
[13] The Federal Republic of Somalia (2022). National Bureau of Statistics: Voluntary National Review Report, 2022. https://www.undp.org/sites/g/files/zskgke326/files/2022-07/VNR%20Report%20Somalia_2022.pdf (Accessed 1 September 2022). Pg. 16.
Access to Finance
The Central Bank of Somalia is responsible for licensing, supervising, and regulating the Somali commercial banking and non-banking financial institutions, including microfinance, mobile money transfer, insurance, and credit associations. Thirteen licensed banks operate in Somalia, namely Dahabshil Bank International, Daryeel Bank, SomBank, Agro Africa Bank, Galaxy International Bank, Mybank Limited, Salaam Somali Bank, Amal Bank, Premier Bank, International Bank of Somalia, Bushra Business Bank, Idman Community Bank, and Amana Bank. Three of these banks offer housing/real estate/land and construction financing. There are seven licensed money transfer businesses, three mobile money service providers, and six major microfinance providers: MicroDahab, IBS Microfinance, Premier Microfinance, AMAL Microfinance, KAABA Microfinance, and Kaah International Microfinance Services. Average microfinance loans are around US$1 000 with a tenure of less than one year.[1]
According to the Central Bank of Somalia, money transfer businesses are “the backbone of Somalia’s inward transfers”[2] with US$4.302 million transferred into the country in 2021. Remittances account for approximately 31.3% of GDP up from 30.8% in 2020.[3] The banking sector is stable, with non-performing loans under 3% of total credit.[4] Real estate loans represented 16%, and household loans 15%, of total loans to the private sector in the fourth quarter of 2021. Real estate loans increased by 20% from US$34.6 million, up from US$28.9 million over quarter three of 2021.[5]
In 2017, 7.9%[6] of adults held accounts at formal financial institutions, indicating low levels of financial inclusion, however this is expected given the nascent nature of the financial sector in Somalia. Financial sector assets were equivalent to 17% of GDP and credit to the private sector was 3% of GDP at the end of 2021.[7]According to Making Finance Work for Africa 2018,[8] key challenges that face the financial sector in Somalia include trust and information deficits, a lack of capacity and financial infrastructure, unfavourable terms and conditions, and insufficient collateral available for most of the public. The Finance for Inclusive Growth in Somalia Programme (under the European Union) seeks to create financial inclusion for women and youth by connecting them to financial institutions for finance and technical support. So far, the programme has had a US$75.9 million development impact across sectors, benefiting 15 businesses and creating 423 jobs.[9] Three quarters of all informal businesses operate without a banking account.[10]
The Somalian banking sector is largely governed by Islamic banking with some conventional banking. Islamic banking is interest-free banking governed by principles of Islamic Sharia Law. This means, in Somalia, lending terms do not include an interest rate. Instead, there is a down payment requirement by banks require a down payment and a Murabaha payment (or profit mark-up) upfront on the net cost of the property.
On 25 March 2020, the International Monetary Fund (IMF) and the World Bank’s International Development Association (IDA) approved Somalia’s eligibility for debt relief under the Heavily Indebted Poor Countries (HIPC) initiative. On 24 March 2021, the IMF granted additional assistance under HIPC of US$0.97 million. Current disbursements amount to US$384.3 million. According to the IMF,[11] Somali authorities have preserved macro-economic stability considering current challenges, which include the COVID-19 pandemic, food security, drought, and energy prices.
[1] The World Bank (2019). International Development Association Project Appraisal Document. https://documents1.worldbank.org/curated/en/267241552269666297/pdf/Project-Appraisal-Document-PAD-SCALED-UP-P168115-revised-February-26-2019-02262019-636878520441412199.pdf (Accessed 09 September 2022). Pg. 11.
[2] The Central Bank of Somalia (2022). Quarterly Economic Review (2021:4) https://centralbank.gov.so/wp-content/uploads/2022/08/Quarterly-Economic-Report-2021-Q4.pdf (Accessed 31 August 2022). Pg. 25.
[3] African Economic Outlook (2022). https://www.afdb.org/en/documents/african-economic-outlook-2022 (Accessed 31 August). Pg 149.
[4]Ibid..
[5] The Central Bank of Somalia (2022). Quarterly Economic Review (2021:4) https://centralbank.gov.so/wp-content/uploads/2022/08/Quarterly-Economic-Report-2021-Q4.pdf (Accessed 31 August 2022). Pg. 23 – 24.
[6] Making Finance Work for Africa (2019). Country Financial Sector Profile: Somalia. https://www.mfw4a.org/country/somalia (Accessed 9 August 2019).
[7] The Central Bank of Somalia (2022). Quarterly Economic Review (2021:4) https://centralbank.gov.so/wp-content/uploads/2022/08/Quarterly-Economic-Report-2021-Q4.pdf (Accessed 31 August 2022)
[8] Making Finance Work for Africa (2018). Financial Sector Development in Post-Conflict: Case of Somalia. https://www.mfw4a.org/sites/default/files/resources/financial_sector_development_-_somalia.pdf (Accessed 9 August 2019).
[9] AECF (2021). Key Data – AECF. https://www.aecfafrica.org/impact/key-data/ (Accessed 31 August 2022)
[10] World Bank (2021) Somalia Urbanization Review: Fostering Cities as Anchors of Development. https://openknowledge.worldbank.org/handle/10986/35059 (Accessed 3 September 2021). Pg. 121.
[11] International Monetary Fund (2022). IMF Country Report No. 22/228
Affordability
Almost 70% of the population lives below the international poverty line of US$1.90 a day. The poverty rate is more prevalent amongst the IDPs with approximately three out of every four (74%) living under the poverty line. Inflation is projected to reach 9.4% in 2022 due to higher food and oil prices.[1] This is spurred on by the Russia–Ukraine conflict and drought in Somalia which is an ongoing threat to food security. The unemployment rate was 21.4% in 2019 and 83% of total employment is in the informal sector.[2] The services sector makes up 59.9% of total employment, followed by industry at 18%, and agriculture of 13.5%. As an example of typical remuneration, a construction labourer may earn US$16/day.[3] These numbers notwithstanding, there has been growth in the economy, per capita income increased by US$117 over a 2-year period to US$557 in 2018 and household final consumption expenditure increased by 3.9% in 2021.[4]
Access to finance or the acquisition of credit is one of the major stumbling blocks for most people wishing to build or buy a house in Somalia. The lack of emphasis on government-regulated housing has allowed the private sector to dominate the housing, construction, and development market. When the poor economy and tenuous governance, as well as the lack of trust in institutions and government, are factored in the financial environment militates against most people acquiring housing finance. Shorter repayment periods and higher installments among other barriers put property acquisitions out of reach of the majority.
Jama[5] indicates that on the housing demand side, key challenges include short repayment periods due to liquidity risk, down payment value requirements, the high Murabaha rate, limited real estate developers and high costs of residential property. Repayment periods of three years, or 60 months (Amal Bank Home Finance), are sometimes too short. The Murabaha rate is between 12%-20%[6] depending on the bank, in addition to the down payment required. Some banks charge a 35% down payment. According to a resident cited in an Al Jazeera article, 60% of salary is spent on housing and 20% on bills.[7]
[1] African Economic Outlook (2022). https://www.afdb.org/en/documents/african-economic-outlook-2022 (Accessed 3 September 2022). Pg. 41.
[2] The Federal Republic of Somalia (2022). National Bureau of Statistics: Voluntary National Review Report, 2022. https://www.undp.org/somalia/publications/sdg-voluntary-national-review-report-2022 (Accessed 31 August 2022). Pg. 41.
[3] Mohamed, H. (2022). Somali real estate boom gives Mogadishu residents money headaches. 12 July 2022. Al Jazeera. https://www.aljazeera.com/news/2022/7/12/mogadishu-residents-real-estate-boom-making-city-unaffordable (Accessed 31 August 2022).
[4] The Federal Republic of Somalia (2022). National Bureau of Statistics: Voluntary National Review Report, 2022. https://www.undp.org/somalia/publications/sdg-voluntary-national-review-report-2022 (Accessed 31 August 2022). Pg. 38.
[5] Jama, K (2016). Presentation: ‘Analysis of Real Estate business in Somalia: Current Trends, Challenges and Prospective’. 25 December 2016. https://www.researchgate.net/publication/311907874_Analysis_of_Real_Estate_business_in_Somalia_Current_Trends_Challenges_and_Prospective (Accessed 20 August 2019).
[6] Abdi, H.S. (2022). Horn Property. Personal communication, 18 August 2022.
[7] Mohamed, H. (2022). Somali real estate boom gives Mogadishu residents money headaches. 12 July 2022. Al Jazeera, https://www.aljazeera.com/news/2022/7/12/mogadishu-residents-real-estate-boom-making-city-unaffordable (Accessed 31 August 2022)
Housing Supply
Given the scarcity of available land for housing developments and actual affordable housing stock for purchase in urban areas overall, a larger proportion of urban households (42%) live in rented accommodation compared to rural households (12%), with Mogadishu accommodating the highest proportion of households who rent at 71%. However, with the exception of land and housing, urban areas generally provide higher standards of living and better access to services compared to rural areas. [1]
Housing development is also constrained by the poor regularisation of land, property and the construction sectors. Some problems the real estate sector faces,[2] include land acquisition troubles, no proper regulation, the cost of materials, and unregulated pricing schemes. Informal settlements are particularly prevalent and growing in number in urban areas. Most informal settlements in urban areas are home to IDPs. At this stage, the government (national and local) has not been able to provide adequate shelter and security for the most vulnerable and poorest residents, who are mostly located in urban areas. A lack of housing has often left destitute Somalis without any option but to build makeshift shelter in informal settlements.
A 2019 International Institute for Environment and Development (IIED) report on Accessing Land and Shelter in Mogadishu[3] indicates that the city has four main types of housing:
- “Buuls” or temporary shelters made from mud, sticks and cloth – average cost is US$13 a month, and they are located on the city periphery, mostly tenanted by IDPs or residents wo cannot access regular housing in the city.
- Corrugated iron sheet housing – average cost is US$140 a month, located within the city and its periphery and typically housing low and lower middle income households.
- Villas – can be found within the city or its periphery, accessed by upper middle income to wealthy households or even rented out to foreign nationals or local and international organisations.
- Apartment buildings – average cost is between US$350 and US$500 a month, mostly located within the city and occupied by middle to upper middle income households.
The cost of the cheapest newly built house is US$40 000 for a 169m2 house which rents at US$300 a month.[4] The cost of a 50kg bag of cement is around US$9. Approximately 90% of construction materials (mainly finishing materials such as steel, wood, and tiles) are imported increasing the cost of housing delivery. Buruuj is the largest construction company in Somalia and it manufactures bricks and concrete. Construction of apartment blocks in the city of Mogadishu has been booming, indicating increased investment in housing by the private sector; however, prices are exorbitant and out of reach for most Somalis.
Approximately US$90 million has been invested in the New Garowe project, which is expected to be complete by 2023. This development will include 2 000 housing units with a mix of three, four, and five bedroomed units, and just over 8 000m2 of retail and commercial space. It is designed to include amenities such as shopping facilities, education, healthcare, established road networks, religious facilities, 24/7 security, and reliable access to services such as water and electricity.[5]
[1] The World Bank (2019) Somali Poverty and Vulnerability Assessment: Findings from Wave 2 of the Somali High Frequency Survey. https://openknowledge.worldbank.org/bitstream/handle/10986/32323/Findings-from-Wave-2-of-the-Somali-High-Frequency-Survey.pdf?sequence=1&isAllowed=y (Accessed 8 September 2021)
[2] Amal Real Estate (2017) Overview of Real Estate in Somalia.https://www.amalrealestate.so/uncategorized/overview-of-real-estate-in-somali/ (Accessed 9 September 2021)
[3] IIED (2019) Accessing land and shelter in Mogadishu: a city governed by an uneven mix of formal and informal practices. https://pubs.iied.org/sites/default/files/pdfs/migrate/10869IIED.pdf (Accessed 14 September 2021).
[4] Abdi, H.S. (2022). Horn Property. Personal communication. 18 August 2022.
[5] Amal Bank (2017) New Garowe Project. https://amalbankso.so/about-us/new-garowe-project/ (Accessed 12 September 2021).
Property Markets
The challenges identified in the National Development Plan (NDP) continue to bedevil the construction sector. The lack of an appropriate regulatory environment and poor governance in the public sector, the lack of building standards and health and safety regulation, high land prices and disputes, and the shortage of skills are all problems. According to an Al Jazeera article,[1] construction prices have increased considerably. For example, a 50g bag of cement increased from US$6 to US$9.5 over two years. Housing demand is so high that properties are snapped up even before entering the market, inflating property prices to the point that dwellings are being established outside the city centre. Women are allowed to buy houses in Somalia, though only men are allowed to inherit property.
Some mixed-use projects aim to stimulate the property market and attract investment into real estate, such as the Daru Salam housing project. The price of rental property for a one-bedroom apartment in the city centre in Mogadishu, according to Numbeo (2022),[2] is US$161.78 and US$73.74 outside the city centre. For a 3-bedroom apartment in the city centre, it costs US$397.96 and US$207.06 outside the city centre. According to Numbeo (2022)[3], the price per square meter to buy an apartment in the city centre is US$43 852 and US$34 458.33 outside the city centre, more than US$7 000 higher than 2021.
An internet search identified many formal real estate agents operating in Somalia, such as Horn Real Estate, My Property Somalia, SomTrust Real Estate, Kirosom Real Estate Solutions, Degaan Real Estate Somalia, Himilo Homes and Kaah Properties, indicating an uptick in the property market. Development is also increasing, with several multi-storey apartment buildings being developed.[4]
The World Bank’s Doing Business Indicators[5] report shows that it costs 1.4% of a property’s value to register it legally, which is lower than the regional average of 7.3%. There are five procedures and it takes 188 days to register a property, more than three times longer than the Sub-Saharan Africa average of 51.6 days. While title deeds are currently only documented on paper, these can be accessed at a notary office at the Court of Appeal. The Court of Appeal and Banaadir Regional Authority (Municipality of Mogadishu, Land Management Department) are responsible for immovable property registration. The Banaadir Regional Authority is also responsible for showing legal boundaries in the business district. The Ministry of Finance provides a tax clearance or Nulla Osta which verifies that a seller has paid all property taxes.[6] Articles 938 and 939 of the Somali Civil Code of 1973 provide the legal basis for dispute resolution.[7] Fraudulent titles and land disputes are still common in Somalia even though property sale transactions are mandated by law to be registered.[8] Prior to 1991, all titles were moved out the country and kept by a former Registrar official. Verification of the authenticity of a title registered before 1991 therefore goes outside the country, costs approximately US$1 000-$2 000 and takes a month to be processed.[9] Ownership details on a property registration in the past ten years is available in an official bulletin at a lawyer’s office and costs US$50 for the lawyer to check. While property registration is not normally done at the courts, banks require property registration at the Court of Appeal if the property is to be used as collateral to obtain a loan.[10]
[1] Ibid.
[2] Numbeo (2022). Cost of Living in Somalia. https://www.numbeo.com/cost-of-living/country_result.jsp?country=Somalia. (Accessed 31 August 2022).
[3] Ibid.
[4] Mohamed, H. (2022). Somali real estate boom gives Mogadishu residents money headaches. 12 July 2022. Al Jazeera. https://www.aljazeera.com/news/2022/7/12/mogadishu-residents-real-estate-boom-making-city-unaffordable (Accessed 31 August 2022)
[5] The World Bank (2019). World Bank Doing Business Indicators, 2020. www.doingbusiness.org/content/dam/doingBusiness/country/s/somalia/SOM.pdf (Accessed 17 August 2020).
[6] The World Bank (2019). World Bank Doing Business Indicators, 2020. www.doingbusiness.org/content/dam/doingBusiness/country/s/somalia/SOM.pdf (Accessed 16 August 2020).
[7] Ibid.
[8] Ibid.
[9] Ibid.
[10] The World Bank (2019). World Bank Doing Business Indicators, 2020. https://www.doingbusiness.org/content/dam/doingBusiness/country/s/somalia/SOM.pdf (Accessed 16 August 2020). Pg. 24.
Policy and Legislation
The development sector, which includes building, land use and the construction sectors, is one of the most highly unregulated sectors in the country, lacking in effective legislation and policies. At present, no distinct regulatory board oversees the development and construction sector. No procedures or regulations appear to be in place to police safety, quality, and protection of rights. A developer and owner of a property or land simply come to an informal agreement with one another.
Evictions are frequent in Somalia with 92 269 evictions in 2022 thus far. Banaardir accounted for 75.2% of evictions with the main reasons for eviction being that the landowner needed their land back or rental default.[1] While the National Evictions Guidelines[2] were published in late 2019, a moratorium on evictions during the pandemic was implemented and 86 979 evictions were prevented through government interventions. In Baidoa where the Eviction Moratorium was extended to March 2021, there were zero evictions.[3] To tackle the problem of evictions in Somalia, National Eviction Guidelines[4] have been drafted to protect human rights and the right to adequate housing.
In 2020, a National Development Plan (2020-2024) [5] was adopted that outlined a five-year plan to improve and grow the economy as well as reduce poverty. This should have a positive impact on the development sector, starting with constructing roadworks. The Somali government signed the Kampala Agreement, which outlines the State’s commitment to protecting IDPs and is relevant to the housing backlog in these communities. Since 2019, Somalia has adopted new policies including the Social Protection Policy, the National Eviction Guidelines, National Policy on Refugee-returnees and IDPs, and an Interim Protocol on Land Distribution for Housing to Eligible Refugee-Returnees and IDPs. The recently published Somalia Humanitarian Response by the United Nations is also committed to meeting the dire needs of Somalis and identifies housing, land, and property as a priority area of focus.
A National Environmental Policy exists for Somalia, endorsed in February 2020, which outlines the extent of the environmental crisis and the necessary policy directives, which, however, have not yet been passed by Parliament.[6]
According to the Voluntary Review of 2022, Somalia has made great efforts to be gender inclusive and empower women. This is evident in the Somalia Women’s Charter, coming out of a convention held in 2019 by the Ministry of Women and Human Rights Development. While women are allowed to buy and rent property, they are not allowed to inherit property.[7] In 2016, the Norwegian Refugee Council published a document on Housing, Land, and Property Rights for Somalia’s urban displaced women[8] considering Islamic practices.
[1] Norwegian Refugee Council (2022) Eviction Trend Statistics. https://evictions.nrcsystems.net/ (Accessed 1 September 2022).
[2] Global Land Tool Network (2020). Understanding Housing, land and property in Somalia. www.gltn.net/2020/03/16/tutorial-understanding-housing-land-and-property-in-somalia/ (Accessed 15 August 2020)
[3] Norwegian Refugee Council (2021). Consultative Evictions’ Mitigation and Prevention Forum in Baidoa. https://reliefweb.int/report/somalia/consultative-evictions-mitigation-and-prevention-forum-baidoa (Accessed 2 September 2021).
[4] Federal Government of Somalia (2019). National Evictions Guidelines. www.refworld.org/pdfid/5d8333ae4.pdf. (Accessed 10 September 2021)
[5] The Ministry of Planning, Investment and Economic Development (2019). Somalia National Development Plan 2020-2024.
[6] BTI Transformation Index (2022) bti-project.org (Accessed 1 September 2022)
[7] WhatsApp correspondence with S. Abdi, Horn Property, 5 August 2022
[8] Norwegian Refugee Council (2016). Housing, Land and Property Rights for Somalia’s urban displaced women. somalia-housing-land-and-property-rights-for-somalias-urban-displaced-women-2016.pdf (Accessed 2 September 2022).
Opportunities
As more Somalis are displaced annually, the demand for affordable housing increases. The high prices of property in the city centre, driven by inadequate supply and ever-increasing demand, proves this. This is coupled with the demand for access to services becoming crucial as food and oil prices rise due to drought and the Russia-Ukraine conflict. The African Economic Outlook 2022 notes Somalia’s dependency on fossil fuels for electricity supply. The impact of climate change on Somalia, its people and economy is devastating. This opens opportunities for innovation around sustainability in energy supply, water, and agriculture. In the face of climate change, alternative building technologies that ensure better adaptation to its impact need to be explored and considered in affordable housing design. Still, the regularisation of property development, real estate, and the construction sectors, as well as formalising legalities around tenure for both land and home ownership and regulating the rental housing market to protect property rights exists. Security of tenure especially for the most vulnerable or marginalised, such as the refugees, the poor, and disabled of Somalia, is imperative. Opportunity also exists for government to facilitate and foster public-private partnerships for private sector involvement and investment in affordable housing sector development. This can also support the formalisation of informal settlements that exist on privately-owned land.
Green Applications for Affordable Housing
The number of displaced persons within the country increased from 1.1 million in 2017 to 3.5 million in 2022, hugely increasing demand for shelter and services. Given the history of displacement and unrest, informality remains a challenge in Somalia. The World Bank’s Poverty Group has created a database of numerous subnational socio-economic and climate risk indicators to pinpoint high-risk disaster hotspots in Somalia where the adverse impact of natural disasters will be particularly high on the poor. This will support planning for humanitarian assistance linked to basic service provision.
Gi: 51% of households do not have access to electricity, with the main sources for cooking being charcoal and firewood. The private sector provides 90% of electricity in urban and peri-urban areas using isolated distribution grids, resulting in inefficiencies. 26.2% of households use cement as flooring material. 43% of households in Somalia have piped water in their yards 0r homes and 40% have basic sanitation services.[1]
[1] The Federal Republic of Somalia (2022). National Bureau of Statistics: Voluntary National Review Report, 2022. https://api.nbs.gov.so/wwwroot/Statistics/9a63ec1d6ddc4e65b891409e70abd614.pdf (Accessed 1 September 2022)
Availability of Data on Housing Finance
Poor access and general lack of availability of data has been identified as a key problem by the Federal Government of Somalia, which has made significant efforts to improve this, which can be seen in the availability of more data and statistics. The primary sources of housing finance data are:
- The Directorate of National Statistics under the Ministry of Planning. Investment and Economic Development is the main provider of statistical data for decision makers and researchers for planning for socio-economic development in Somalia. To this end, the Somali Health and Demographic Survey 2020[1] was recently launched, the first of its kind in Somalia. The CPI index and COVID-19 situational update is also published by the department. A new development is the availability of statistical publications in the form of quarterly bulletins and the Voluntary National Review Report, 2022.
- The Central Bank of Somalia provides data on banking supervision and licensing, and has a function for economic research (as yet no archives are available). Generally, annual reports provide information but these have not been updated in three years. A new development has been the publication of quarterly reports.
- The United Nations High Commissioner for Refugees (UNHCR) collects data on internally displaced persons in Somalia by monitoring refugee and movement patterns, access to services and nature of vulnerability. In addition, UNHCR is monitoring COVID-19 outbreaks in some IDP camps in Somalia.
- The United Nations Office for the Coordination of Humanitarian Affairs collects data on humanitarian needs in Somalia.
[1] The Federal Republic of Somalia (2020). The Somali Health and Demographic Survey 2020. http://www.dns.org.so/wp-content/uploads/2020/04/SHDS-Report-30-04-2020.pdf (Accessed 1 September 2021)
Additional Sources
Somalia Protection Cluster (2020). Constant risks, looming disaster: the urgent case for a moratorium on evictions.www.globalprotectioncluster.org/wp-content/uploads/Somalia_Evictions-Advocacy-Brief-20200406.pdf
Websites
- United Nations: https://somalia.un.org/
- Central Bank of Somalia: https://centralbank.gov.so/
- Ministry of Finance Somalia: https://www.mof.gov.so/
- Ministry of Planning, Investment and Economic Development: https://mop.gov.so/
- Directorate of National Statistics: Somalia http://www.dns.org.so/
- Global Land Tool Network: https://gltn.net/
- The UN Refugee Agency: https://data2.unhcr.org/
- Ministry of Health Somalia: https://moh.nomadilab.org/
- International Monetary Fund: https://www.imf.org/
- Numbeo: https://www.numbeo.com/
- Making Finance Work for Africa: https://www.mfw4a.org/
- World Bank: https://www.worldbank.org/en/country/somalia