Housing Finance in Zambia


This profile is also available in French here.

To download a pdf version of the full 2023 Zambia country profile, click here.

Zambia’s young population is expanding at a rate of 2.9%, and there are 20 million people living in the nation, 45% of whom live in metropolitan areas. Young people will exponentially increase the demand for affordable housing, and the delivery system will need to adapt to accommodate growth.

Zambia’s GDP grew by 4.6% in 2021, and it is projected to grow by 3% in 2022. Only two shocks, the pandemic and climatic variability, have changed the country’s trajectory of development. The country’s GDP per capita has decreased by 40% since 2013, to ZMW18 558 ($1 120). The government’s efforts to get Zambia’s finances back on track have also focused on the country’s large debt load.

According to projections, climate change is currently costing Zambia’s economy 0.4% of its annual growth and could reduce its GDP by ZMW228.6 billion ($13.8 billion). 2017 saw the introduction of Zambia’s National Climate Change Policy. However, neither housing nor the built environment are specifically mentioned in the policy. A national climate change learning strategy was introduced in 2021, mainstreaming climate change in industries like housing, energy, water, and sanitation.

Zambia’s unemployment rate is expected to be 13% in 2021, with slightly more women (13.8%) unemployed compared to males (12.3%). The youth unemployment rate in urban areas is even higher, at 17.1%. Approximately 80 percent of Zambia’s population is considered to be low-income. This has a direct impact on housing affordability and access to finance. Given that a one-bedroom apartment in the city centre of Lusaka typically costs ZMW4 900 (US$296), while a three-bedroom apartment costs up to ZMW12 730 (US$768), housing becomes unaffordable for those in the informal sector with variable salaries as well as those on low incomes.

As of December 2021, Zambian mortgage lenders had 7,400 outstanding mortgages in the market with a total value of ZMW 10 billion (US$603 million). The minimum and maximum mortgage rates offered are 16% and 34.5%, respectively. The maximum loan-to-value on a residential mortgage is 100%, while ZHL offers one of the lowest rates at 50%. Most mortgages in Zambia are offered for a period of up to 25 years.

The demand for building materials will continue to grow, and localising the production of sustainable building materials is an opportunity to directly address the housing challenge and climate change.

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 2023 edition, which has up-to-date profiles for 55 African countries.

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