Africa Looks Inwards To Solve Housing Shortage Amid Growing Population

With a population of roughly 1 billion people, Africa is a diverse continent of 54 countries and thousands of languages. That is not to save the fact that many of its economies are facing similar challenges. One of the most common obstacles African markets face is a shortage of affordable housing.

Kenya has a housing gap of approximately 2m homes, for example, while more than 12m people in Egypt live in informal buildings. This is hardly unique to the continent, but with high GDP expansion, limited job creation, strong population growth and rapid urbanisation, its acuity in African economies is more pronounced.

There are upsides to these drivers, of course. It is estimated that by the year 2040, for example, the continent is expected to have the largest workforce in the world, and African cities and towns will see consumer spending exceed USD$2 trillion. To foster and sustain high economic growth – and the positive factors that come with to African markets will need to improve the fundamentals of their housing sectors. While the specific features of local real estate markets and regulatory regimes vary significantly across the continent, from Egypt to South Africa, chronic housing deficits, a lack of funding and an affordability gap are common throughout the region.

Policymakers are turning their attention to the problem and are developing both supply- and demand-side interventions to tackle one of the continent’s most pressing social and economic issues.

It is not lost that through these aspects that industry players like new entrant into the African market, Omoh Homes, headquartered in Nairobi Kenya, is aiming to providing workable and formidable solutions as a way of bridging the gap witnessed in the African market.

“We understand the needs of the market and it is our hope that the products we will be seeking to launch in the course of this year are, in one way or the other, going to help assist and provide a cushion in the sector starting from Kenya,” said Nicholus Okach, Omoh Homes CEO.

According to Mr. Okach, demographical trends alone do point to the pressing challenge on provision of housing. While much of the world is experiencing a slowdown, or even a decrease, in population growth, the rate of demographic expansion in Africa continues to rise.

By 2050 the population of the continent will have doubled, meaning that the region will have added 3.5m people per month. Indeed, Africa will contribute more than half of the world’s total population growth through to 2050 and more than three-quarters of that growth up to 2100. The situation is not uniform across the continent. Some countries will see even greater population burdens. Nigeria, for example, which currently has roughly 180m people, could have the greatest population increase of any nation in the world through to 2050, according to some projections.

The sheer numbers alone illustrate the challenges of housing provision. And given that Africa already has the youngest population in the world, countries within the region are in for a prolonged period of demand for housing as graduates and young professionals contemplate getting married and starting families. This is already evident in a market such as Egypt, where there are almost 900,000 marriages per year, and as such the large pool of first-time home seekers are increasing the demand for residential units.