Average house price soars above N$1.3m …pushes ownership out of reach for ordinary Namibians

Average house price soars above N$1.3m …pushes ownership out of reach for ordinary Namibians

Owning a home in Namibia is becoming increasingly challenging, as the average house price surpassed the N$1.3 million mark during the third quarter of 2024. 

The average Namibian house now costs N$1 303 179, which is a notable increase from the N$1 263 673 recorded in the second quarter of the same year. 

This increase reflects a growing trend in the housing market, which is pushing homeownership out of reach for many Namibians.  The latest data, released by the FNB Namibia Housing Price Index this week, reveals that the 12-month moving average prices for the central, coastal, northern and southern regions stand at N$1 659 000, N$1 459 000, N$879 000, N$851 000 respectively. 

Mandisa van Wyk, FNB Namibia’s market research manager, noted that volume growth continues to show improvement but remains in contraction.

This is as buying activity continues to be hampered by potential supply constraints and a backlog of serviced plots by various municipalities. “The weak activity is further underscored by the growth in mortgage credit extended to households, which grew to 1% year-on-year as at the end of November 2024,” said Van Wyk.  On the positive side, the Bank of Namibia eased interest rates last month, bringing the repo rate to 7%. 

This, along with the amended tax regulations of reduced rates and tax refunds, has provided additional disposable income for consumers.

The National Housing Policy 2023 report, released by the Ministry of Urban and Rural Development late last year, reveals that only 1.7% of Namibians can afford a house of N$1 million or more. 

This status quo is worsened by the rapid urbanisation and migration that is driving many residents into informal settlements, where some 67% of the urban population resides. Meanwhile, urban and rural development minister Erastus Uutoni took issue with the shortage of serviced land. 

He said the obstacle remains a serious challenge for the housing sector. 

“Local authorities continue to sell land to private property developers, who, in turn, sell houses at exorbitant prices. This creates a mismatch between demand and supply. Available serviced land and housing is priced due to input costs,” he stated. 

The NSA census released last year reveals that Namibia’s population is 3.3 million, with more than half of the people living in urban areas.

Further, the national housing policy of 2023 shows that, across the country, 62.4% of households earn less than N$5 000 per month, placing them in ultra-low-income brackets. 

While government has put up interventions to build houses for the nation, it was reported in the media that the National Housing Enterprise (NHE) has built only 21 545 houses since its inception 31 years ago. 

This has resulted in the NHE dealing with a current backlog of more than 300 000 houses.

Over 120 000 applicants have been on the NHE’s waiting list since 2005. 

-mndjavera@nepc.com.na