Zambia Show Potential for Affordable Housing Development

Zambia housing affordability

Zambia retains a large untapped residential property market especially for affordable housing, the Centre for Affordable Housing Finance (CAHF) in Africa indicates in its latest report on Africa’s housing finance markets.

This is mainly due to the 33 new districts created by the Zambian Government, which require new housing.

Furthermore, the report indicates that there is a gap between what Zambians can afford and the price of housing on the market.

In 2016, the cheapest newly built 2 bedroom, 65m2 house in Zambia by a formal developer cost about USD24,382, while developers targeting young professionals are building houses that sell in the range of USD60,000 and USD100,000.

The construction cost of a 2–3 bedroom high cost house is USD80,000–USD150,000 with monthly rentals of USD800 to USD1,000 while a 2–3 bedroom middle-income house cost from USD65,000 to USD100,000.

However, low income households in urban areas can purchase a house costing between USD6,584 and USD10,741 while small scale farmers in rural areas can afford a house costing USD2,675.

In light of these challenges, CAHF points out that microfinance for the housing sector has good potential for growth in Zambia.

Moreover, there is huge potential to increase financial inclusion among the majority of poor as well as use of loans and mortgages.