New players in Cote d'Ivoire's real estate sector spur competition as government works to facilitate access to home loans
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Loading... - Shandra Abeng
- 05 Sep 2022
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As is the case throughout the region, real estate demand in Côte d’Ivoire is generally high, surpassing existing offerings in most, if not all, segments, from housing to industrial, office space and retail. The situation is particularly acute in the housing sector, with a national housing deficit of 400,000-600,000 units. The government has enacted a large-scale social housing programme, but progress has been slow. Home ownership remains an aspiration for many Ivorians who cannot afford current market prices or access housing loans. As for attracting more investment, ongoing efforts to enhance the collection and analysis of quality sector data may prove positive for this goal in the near future.
Housing Deficit
With a deficit of 400,000-600,000 housing units, half of these in Abidjan, and demand growing by 40,000-50,000 units every year, Côte d’ Ivoire is struggling to satisfy the population’s search for a decent roof. Until 1980, most housing was built or developed through state-owned institutions such as the Société de Gestion Financière de l’Habitat, Groupement Foncier de Côte d’Ivoire, and Société Ivorienne de Construction et de Gestion Immobilière (SICOGI), which together accounted for 120,000 units built before 1980. As the economy slowed in the late 1970s, the government shifted the onus of housing construction gradually towards the private sector, dropping housing subsidies in 1995. The effect was a slowdown in residential activity, with only around 26,000 units built between 1980 and 2005. A lack of incentives for the private sector, a growing population and high urbanisation rates contributed in time to a rising housing deficit. The impact on home ownership is clear. “Out of 100 requests, we are able to help 10-15 clients,” Mariam Mahama, sales director at real estate agency Kalimba, told OBG. “Sometimes, we work with other agencies in pairs so as to ensure a higher response rate.”
According to a 2015 Knight Frank study, 68% of Ivorians rent their apartments or houses. In Abidjan mid-market monthly rents are below CFA500,000 (€750), while rents in the high-income segment are in the range of CFA1.2m-1.5m (€1800-2250). However, rents in the latter segment can rise to as high as CFA3m-5m (€4500-7500) for luxury accommodations.
Increasing Supply
To address this challenge, President Alassane Dramane Ouattara promised during his 2010 campaign to build 60,000 housing units, including 50,000 in Abidjan, during his first term in office. In addition to SICOGI, which is currently overseeing the construction of 15,000 units, another 46 real estate developers, including four foreign companies – Moroccan real estate developers Addoha, Alliances Group and Palmeraie Développement and US developer African Business Development – are working on the government’s social housing programme, contributing around 36,000 units between them. Read More...
