African Development Bank Group

Housing Market Dynamics and Financing in Africa:Strengthening Partnerships and DFIs Involvement

(Concept)

Issa FayeDivision Manager, Development Research Department

African Development BankSeptember 11, 2013

Presentation to the MFW4A Housing Finance-Donor Working Group

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Outline

I Background

II Objectives

III Themes

IV Activities

V Collaborations and Partnerships

VI Next steps/Timeline

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Background

“African cities will have to accommodate more than 300 million new residents over the next 25 years”.

“Currently, 62% of the population (191million people) living in Africa’s cities lives in informal housing, where basic services are poor or non-

existent”

“Much of the literature on housing concentrates on the regulatory and public sector aspects of housing, depicting it as a social welfare problem, rather than

an economic growth opportunity.”

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Bank Additionality and Affordable Housing: How to best complement public and private sector players in enhancing the supply of affordable housing?

To provide a comprehensive analysis of Africa’s housing market

To propose feasible financing and policy schemes

Using lessons learned from other emerging markets

Objectives

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Themes The challenges of affordability and access to long term funds: mortgage development, reaching the unbanked, the role of microfinance.

Developers capacity and the mass scale delivery of housing stock: access to financing for developers, developers capacity constraints and their (in)ability to reach economies of scale.

Building technologies, materials and professional services: housing cost structure, incremental housing as a solution, alternative building techniques, green housing.

A viable business opportunity for the private sector? Existing policies, experiences with private sector involvement, public private partnerships, subsidized infrastructural services.

Financing Demand

Financing Supply

Construction, Cost and Technology

Land and Infrastructure

Enabling legal and regulatory frameworks and land governance issues: land regulation and tenure security, the role of central government and local authorities.

Social/Low-Cost Housing and Slum Upgrading

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Activities

5 Thematic Papers

5 Regional Workshops

Dissemination

Final Report

5 background scoping papers will be prepared, with each providing a comprehensive analysis on the above mentioned themes.

Validation workshops will be organized in the Bank’s 5 regional classifications: Eastern, Western, Northern, Southern and Central Africa.

The core output of the study will provide a comprehensive market analysis at continental level while proposing concrete policy recommendations to foster private sector and DFIs involvement in affordable and quality housing on the continent.

A dissemination exercise to ensure that the findings are leveraged to the greatest extent.

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Collaborations & Partnerships

- Data Exchange - Cost Sharing

- Workshop Facilitation

External Partners

AfDB

Recently secured a grant from the Brazilian government to part-finance the study for experiences and lessons to be learned from other developing countries (a South-South partnership)

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Next Steps/Timeline

Q4 2013

• Partnership arrangements• Consultant Selection • Scoping exercise (facts finding missions)

Q1 2014

• Receipt of thematic papers• Review process• Revision and finalization of thematic papers

Q2 2014

• Draft report• Regional workshops

Q3 –

Q42014

• Final report• Dissemination and learning trips

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THANK YOUi.faye@afdb.org