Housing Finance in North Africa


The most recent regional profile for North Africa is from 2019, and is also available in French here.

To download a pdf version the full 2019 North Africa regional profile, click here.

The housing finance sector exists in a regional market with a large unmet demand for financial services and unbanked economic citizens. This suggests that there exists opportunities for financial providers to meet the unmet demand across the Arab world. To close the severe gaps in financial inclusion in North Africa, governments are increasingly starting to develop national financial inclusion strategies driven by evidence-based dialogue among public and private stakeholders.

Africa’s rapid urbanisation and population growth has led to a severe affordable housing shortage and a rise in informal settlements.

All North African countries are suffering from the lack of middle income housing supply and this is considered one of the major challenges facing the real estate industry. As population growth and urbanisation continue, countries across the region are facing growing pressure to accommodate the evolving needs of urban dwellers. This includes the need for more good quality, affordable accommodation within developed communities, for middle income individuals and households.

The bond market is underdeveloped in the North African region except for Morocco and Tunisia, due to financial system reform. Despite that, the market in the two countries is suffering from low volumes, low liquidity and a strong tendency to “buy & hold”.

The socio-economic impact of the housing shortage is clear. It causes overcrowding, increases the incidence of diseases, and hinders the provision of basic social and public services such as water, sanitation, education, and physical safety. In such a situation, high population growth and a youth bulge tend to be liabilities rather than dividends.

This shortage threatens the long-term stability of the region. Governments across the region have acknowledged the seriousness of this problem and have implemented a range of policies to tackle the shortage. However, most of these initiatives are at the early stage of implementation and further efforts are needed to ensure the successful delivery of more affordable projects.

Nevertheless, housing remains at the forefront of the agenda for most North African governments. The link between affordable housing, economic development and social inclusion has been clearly recognised, particularly as many protests across the region have been linked to poor living conditions caused by failures in housing policy.

The North African region needs to have more social housing programmes and give incentives for contractors to build middle income housing. In addition, housing policies need to be shifted from supply-side support to direct demand-side subsidies , although the allocation of government-owned land remains critical to achieving low-cost levels.

To improve the lives of urban dwellers, create jobs, and enhance productivity, North African countries need to reduce the housing backlog. Because of its extensive linkages with manufacturing, the financial sector, and other service subsectors, residential housing construction in developing countries is very labor intensive and has high output multiplier effects.

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


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