In February 2016, the African Development Bank approved a US $8.2 million equity investment in Africa’s housing and habitat company Shelter Afrique in order to boost the provision of affordable housing on the continent (AfDB, 2016).
The AFDB decision marks an important step toward the provision of more affordable housing in Africa, as the majority of households still cannot afford basic formal housing or access mortgage loans. In 2014, only 5 percent of adults in Sub-Saharan Africa took a mortgage loan from a formal bank, according to the World Bank (2015).
In many African countries, the demand for affordable housing far outstrips supply, a situation which has been critiqued as the epitome of government and market failure (Marwa, 2016).
Housing programmes in African cities, generally, are unaffordable not just because incomes are too low but also because the key inputs that affect housing costs — land and building materials — are too expensive (UN Habitat, 2011). Therefore, despite being the initial target of affordable housing programmes, lower income populations in African countries are actually often left out by these same programmes.
There are several ways to make housing more affordable, from diminishing the cost of construction to adjusting the cost of land. Given that these solutions are highly contextual, there have been controversies on the best way to follow, and the best policy mix to enforce in different African countries.
Since African states are encouraged to adopt the enabling approach (UN Habitat, 2011; World Bank, 2015), direct government provision of affordable housing appears to now belong to the past. However, publicly driven housing projects which aim at increasing housing supply at a large-scale continue in some places like Egypt and Ethiopia.
Too often, these projects are critiqued for being of another time. However, critiques of such projects often ignore the evolution of publicly-driven housing, and how it can work along with market forces in African cities, without constraining them (Buckley, R. M. and J. Kalarickal, 2005).
Affordable housing and the evolution of the State
The limited impact of government policies to address the need for affordable housing is not a new phenomenon on the continent. Historically, social housing has rarely met its “social” objectives in African cities (Biehler, Choplin et Morelle, 2015).
The evolution of social housing in Africa, its objectives and modalities, is intimately linked to the evolution of the role of the State from a direct provider to an enabler of housing.
From the 1950s onward, during the period when many African countries achieved independence, large-scale housing programmes were launched in several countries. These, however, soon proved expensive to build and largely unaffordable to target beneficiaries, according to UN-Habitat. The urban poor had “few other options but to build their own shelter” in informal settlements (UN-Habitat, 2011).
In the wake of structural adjustments in the 1980s, public housing stock was progressively privatized. Over this period, the state progressively evolved into playing an enabling role, following for instance the “sites and services approach” advocated by the World Bank. Countries like Kenya, and Zambia particularly embraced this approach (UN-Habitat, 2011).
The enabling period was nonetheless characterized by a lack of coordination between government efforts and the private sector in the provision of housing for low-income households (UN Habitat, 2011).
Thus, countries like Tunisia and Burkina Faso, under the impulse of Thomas Sankara, continued to directly provide housing (Biehler, Choplin et Morelle, 2015). Nigeria, which embraced the enablement strategy during that period, also launched a large-scale housing programme and constructed 32,000 units between 1980 and 1983 (UN Habitat, 2011).
Challenges of publicly-driven housing
Privatisation of public housing has decreased affordable rental housing options in many African countries (UN Habitat, 2005). Developers have little incentives to engage in housing delivery for lower-income groups and therefore mainly choose to focus on high-end projects. The enabling approach to affordable housing has proven inadequate in promoting the provision of affordable housing at a large scale (World Cities Report, 2016).
Therefore, the main issue lies in the capacity of public actors to direct better-designed and better-targeted affordable housing subsidies, without causing major market distortions.
Through public-private partnerships, some countries like Algeria, Egypt, Ethiopia, and Mali, continue to launch large-scale affordable housing programmes (UN Habitat, 2011).
While these programmes haven’t met their initial targets in the construction of units, they demonstrate the importance of political will and institutional capacity for the provision of affordable housing.
Government subsidies for social housing in African countries are mainly supply-side. While these encourage infrastructure provision, they do not necessarily engage low-income households to invest in housing (World Bank, 2015).
Moreover, when affordable housing is constructed today it generally offers low-cost home ownership, and there is typically the requirement that buyers earn a salary. This makes it exclusionary. The main challenge for large-scale affordable housing programmes is also to meet the long-term needs of the beneficiaries. The poor quality of construction and poor location of affordable housing condominiums is generally cited as the main issue (UN Habitat, 2011). When located on the urban periphery, where land is typically cheaper and more readily available, difficulties in accessing economic opportunities also push residents to leave their apartments. Also, many apartments are allocated to households that cannot afford them and who thus end up converting them into rentals (UN Habitat, 2011).
Making affordable housing more accessible
To expand access to affordable housing, African cities need to reflect on past and present experiences of publicly driven housing. A decentralized model in the public provision of housing is needed in order to adapt affordable housing programmes to the contexts in which they are implemented.
It is clear that public sector provision of housing will not meet affordable housing needs by itself. However, neglecting it in favour of solely enabling mechanisms is also a mistake.
In order to “(re)invent the social housing model in Africa”, we need to explore new ways for the public to intervene in the provision of social housing, argue Biehler, Chopin et Morelle (2015).
This intervention would include engaging informality and looking at new ways to initiate a political dynamic of social housing. A deeper look at the impact of remittances in terms of housing finance could, for instance, help to better channel demand-side subsidies to low-income households.
Hugo Halimi is an intern with urbanafrica.net.
Photo: Social housing in Boca, Portugal. Credit: Wojtek Gurak (Flickr).
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