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Understanding the housing challenge in Kigali

Updated: Nov 22, 2022

The high cost of land, and imported construction materials, as well as high-interest rates for loans, have been cited as the main factors undermining housing ambitions.

Researchers working with the Institute of Policy Analysis and Research (IPAR-Rwanda), said that with a high rate of urbanization and population growth, there is more demand for houses but the cost of land and other housing inputs are still expensive and hard to access.

Rwanda targets to have 35 percent of urbanisation by 2024 from 18.4 percent in 2017. By 2050, 60 percent of the African population will be living in cities triggering the need to access housing according to experts.

The researchers' analysis recommended engaging academic and research institutions to identify innovative ways to make housing affordable, finance schemes, and produce locally sourced low-cost construction materials for Rwanda’s context.

The analysis found that there is a need for coordinating all housing projects across the country and identifying further causes of problems related to affordability.

Keeping housing affordable

The research also highlighted the need to regulate prices set by housing developers to ensure affordability.

Marie Chantal Rwakazina, the ex-Mayor of Kigali City, said that the city has committed to buying and securing a land bank every year to enable the development of infrastructure including affordable housing projects, expropriated residents, and others.

(Landbank is a large area held by a public or private organisation for future infrastructure development.)

According to the Minister for Infrastructure from 2018 to 2022, Claver Gatete, "there is also an effort to engage investors and upgrade dwelling slums without relocating residents but help them set up decent houses since they contribute their land to the project."

Mr. Gatete added that people with a monthly income between Rwf200,000 and Rwf700,000 will soon be benefitting from a new affordable housing fund that will provide loans at lower interest rates to be paid between 20 and 25 years.

“The fund under BRD has a $150 million initial investment and we are seeking other partners to inject in more funds. For instance, the International Finance Corporation of the World Bank and the Housing Bank from India are keen on partnering with the fund. We want low-income earners to get affordable houses that are less than Rwf30 million to as low as Rwf10 million,” he said.



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