House prices in Namibia increased more rapidly at the end of 2025, despite a decline in the number of people able to purchase homes, according to the latest First National Bank (FNB) House Price Index. 

The index rose to 7.6% in the fourth quarter of 2025 (4Q25), increasing from 5.9% in the previous quarter. Meanwhile, growth in housing transaction volumes decelerated to 17.0%, down from 18.4%, indicating an uneven property market. 

FNB’s market research manager for treasury, Mandisa Van Wyk, noted that significant price increases were primarily observed in the central and coastal areas, whereas the northern region remained the top in transaction volume. 

Although the Bank of Namibia has cut interest rates and inflation is easing, many households still cannot afford homes. Mortgage credit growth remains sluggish at 0.2%, indicating that lower rates have not led to increased borrowing. 

“The market remains resilient, but participation is narrow. Demand continues to outpace supply, which is keeping upward pressure on house prices, even as many households are priced out,” she said. The Central House Price Index surged to 7.9% in 4Q25, up from 4.8% in the previous quarter and above the 7.2% growth recorded earlier. 

The average house price now stands at N$1.79 million. 

Van Wyk shared that the central region has shown a strong recovery since exiting contraction in early 2023. 

However, transaction volumes in the region slowed slightly, growing by 11.7%, down from 12.1% in the previous quarter. 

In the coastal region, house price growth picked up to 4.2%, from 1.2% in the third quarter. 

The average house price reached N$1.54 million. 

Transaction volumes increased by 36.4%, although this rate was slower than the 41.5% growth seen earlier in the year. FNB reported that the main drivers of activity were the small and medium housing sectors. 

The coastal region accounted for 20% of national housing transactions, unchanged from the previous quarter but lower than the previous year. 

Northern growth 

The northern region recorded the highest growth in housing activity. Transaction volumes rose to 15.5%, up from 11.8% in the previous quarter, rebounding strongly from contraction in 2024. 

House price growth in the north slowed slightly to 9.5% but remains well above last year’s levels. The average house price stands at N$980 000, making it one of the more affordable regions. 

“The northern region continues to attract buyers due to relatively lower prices,” she said. 

In the southern region, house price growth slowed to 6.5%, while transaction volumes remained flat. 

Only 22 housing transactions were recorded over the year, resulting in a highly volatile data. 

FNB warned that volume movements in the south should be interpreted with caution due to the very small number of sales. 

Van Wyk explained that the main cause of rising prices is robust demand paired with limited supply, especially a shortage of serviced land. 

The delivery of residential serviced plots decreased by 34.7%, further widening the demand-supply gap. She observed that market momentum is becoming more influenced by higher-income buyers and international interest, whereas typical households continue to face constraints from elevated debt and affordability challenges. 

The government has indicated that it is considering measures, such as capping housing and rental prices, to address affordability challenges. 

Projections 

Looking ahead, FNB expects Namibia’s housing market to remain firm but uneven, with prices likely to stay high, especially in the central and coastal regions. 

“Housing prices are expected to remain elevated, supported by resilient demand and limited land availability. Transaction activity may continue to shift toward more affordable regions, particularly the north,” she said. 

Housing crisis 

Namibia has long struggled with housing issues. Population increase, urban migration, and a lack of readily available serviced land plots with roads, water, and electricity have hindered many from securing affordable homes. Many Namibians find it difficult to save enough for a deposit, and banks are cautious about lending to lower-income individuals. 

This creates a market in which demand is high among wealthier buyers, but average households find it difficult to compete. Meanwhile, rising costs of building materials have further driven up prices. 

Consequently, housing in cities like Windhoek, Swakopmund, and Walvis Bay has become more expensive, leading some buyers to consider smaller towns or northern regions where prices are typically lower. -pmukokobi@nepc.com.na