Housing Finance in Zambia


This profile is also available in French here.

To download a pdf version of the full 2020 Zambia country profile, click here.

Zambia is a landlocked country located in Southern Africa and has one of the highest urbanisation rates in Africa with 43 percent of households living in urban areas as of 2015.[1] Economic activity is concentrated in the Lusaka and Copperbelt provinces.

Before the pandemic, Zambia had been facing several macroeconomic challenges. Economic growth declined from four percent in 2018, to an estimated two percent in 2019. High fiscal deficits have increased general government debt to 88 percent of GDP in 2019, from 32 percent in 2014.[2] Interest rates are close to 30 percent and depreciation of the Zambian Kwacha against the US Dollar among has largely contributed to inflationary pressures. COVID-19 has exacerbated the challenges facing Zambia’s economy, financial sector, and livelihoods. The BOZ forecasts the Zambian economy to contract for the first time in more than 20 years by 4.2 percent in 2020 from 2019’s growth of 1.9 percent.[3]

The ability to access finance in Zambia is still low but mobile money is increasing financial inclusion. Ten out of 18 banks offer mortgages in Zambia. There are 129 non-banking financial institutions, including one building society, and 33 microfinance institutions. Several factors make mortgages a difficult product – high interest rates, lack of land titles, and sources of funding for banks.

The high interest rates and low average household incomes diminish housing affordability. Approximately 60 percent of urban households in Zambia rent and 40 percent own the homes they live in. When households build their own homes, they do so incrementally, as and when money is available. Most housing ownership is informal as only approximately 200 000 land titles had been issued in Zambia by 2018.[4] Financing can be from short-term housing construction loans, family help, or other cash events.

In August 2019, the ‘Buy a Brick’ campaign by People’s Process on Housing and Poverty in Zambia (PPHPZ) launched with support from Stanbic Bank the aim of building 1 000 housing units for the for the low income population vulnerable across the country.[5]

Due to the pandemic, it is expected that the reduced rates of private home construction due to contractions in disposable incomes will result in construction declining by at least five percent.[6]

Despite a weakening macroeconomy, there are major opportunities in Zambia’s housing finance market: (i) apartment buildings will provide attractive returns for local investors (ii) given the strong focus on self-build in Zambia, housing microfinance using mobile money platforms could be a highly attractive opportunity for tech-savvy lenders and (ii) development finance institutions could consider funding smaller projects in incremental housing and back-yard housing.


[1] Central Statistical Office (2016). 2015 Living Conditions Monitoring Survey Report. https://www.zamstats.gov.zm/index.php/publications/category/27-living-conditions (Accessed 30 August 2019). Pg. 30.

[2] FitchRatings (2020). Zambia’s 2019 Debt Rise Highlights Fiscal Challenges. https://www.fitchratings.com/research/sovereigns/zambia-2019-debt-rise-highlights-fiscal-challenges-05-03-2020#:~:text=According%20to%20a%20fiscal%20update,the%20budget%20target%20of%206.5%25.&text=Zambia’s%202020%20Budget%2C%20approved%20in,deficit%20to%205.5%25%20of%20GDP. (Accessed 8 October 2020)

[3] Bank of Zambia (2020). Monetary Policy Committee Statement 19 August 2020. https://boz.zm/monetary_policy_committee_statement_august_2020.pdf (Accessed 8 October 2020).

[4] Tembo, E., Minango, J. and Sommerville, M. (2018). Zambia’s National Land Titling Programme – challenges and opportunities. Land Links. https://www.land-links.org/wp-content/uploads/2018/03/Session-06-05-Tembo-153_paper.pdf (Accessed 11 September 2019). Pg. 2.

[5] Shilangwa. E (2019). Stanbic puts its weight behind Zambia’s project to construct 1 000 houses for the poor. 3 August 2019. https://www.iol.co.za/business-report/international/stanbic-puts-its-weight-behind-zambias-project-to-construct-1-000-houses-for-the-poor-30190119 (Accessed 10 October 2020)

[6] UNDP (2020). Mitigating the Socio-economic Impact of Covid-19 in Zambia: A Rapid Assessment. April 2020. https://cuts-lusaka.org/pdf/policy-brief-mitigating-the-socio-economic-impact-of-covid-19-in-zambia.pdf (Accessed 12 October 2020)

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 2020 edition, which has up-to-date profiles for 55 African countries.

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