Housing demand in Kigali

  • The Government of Rwanda would like to understand the quantity of housing need in Kigali, and to update it from an earlier 2012 study conducted by the European Union, as well as to understand how to expand affordable housing.
  • This project estimates: i) the quantity of housing needed in Kigali, Rwanda; and ii) the purchasing power of tenant and mortgage-holding households with respect to housing; and thereby aims to contribute to an understanding of market demand for housing in Kigali, Rwanda.
  • The study estimates that around 415,000 houses will need to be built in the period from 2015 to 2032 to provide dwelling units of adequate standard to all additional households in Kigali during this period; annually this represents 21,000 rising up to 28,000 during the same period.

The study estimates that around 415,000 houses will need to be built in the period from 2015 to 2032 to provide dwelling units of adequate standard to all additional households in Kigali during this period; annually this represents 21,000 rising up to 28,000 during the same period. In addition, in 2014 there was a housing backlog of 133,000 houses, representing almost half the housing stock, that need to be replaced according to criteria provided by the City of Kigali, although we recommend that the criteria for replacement should be carefully revisited. This study then projects income for all income quintiles and estimates the maximum value of property that a tenant household and a mortgage-holding household can afford at the different quintiles. A household at the median of the middle quintile can afford to rent a house worth 11.4 million RWF in 2020 or a mortgage of 6.1 million RWF if they can afford a 20% downpayment.

Policy recommendations:

  • Infrastructure will take a large amount of public investment; for cost effectiveness, it should be planned and built before housing, and might include a well-designed “sites and services” pilot.
  • An incremental approach takes time but is a financially manageable way to upgrade housing.
  • Public money should be spent on social housing for the most vulnerable, in locations sufficiently close to jobs, but thought must go into choosing evidence-based, innovative, and cost-effective ways to enhance social welfare.
  • Affordable housing should be affordable to households below the top two quintiles.
  • If possible, the cost of construction should be reduced in ways that can be scaled up in the construction industry in Rwanda.
  • Master Plan zoning should be flexible and respond to market conditions and should be cognizant of the effects that such plans can have on housing affordability.
  • Inclusive densification should be pursued.
  • Housing finance should be made more affordable on a self-sustaining basis.
  • The definition of housing backlog in this study needs discussion and refinement if it is to lead to upgrading policy.
  • Policymaking must be data driven.
  • An Affordable Housing Working Group could be instrumental.

Outputs

  • Research in progress.

    Project last updated on: 16 Jan 2019.