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Lessons Learned in Affrodable Housing
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Wagane Diouf, CEO Urbanis Africa – www.urbanisafrica.com
Lessons Learned in Affordable Housing
In the price range between $15,000 and $100,000 the demand for housing will not be met in Africa for another 50 years to come. Here is why ?
1Market Demand
Affordability can only be achieved trough scale, cross subsidization, design and building at the periphery of large cities
1 Affordability
Ordinary African do not welcome new housing technologies. We are at the early stage of the adoption curve. The market needs early adopters.
3 Technology
4 Equity Financing
Equity Financing is the hardest funding to raise. The preferred approach is a large scale private placement to local investors.
The real obstacle to the growth of affordable housing is the financing of the buyer. Africa is 80% informal – Therefore mortgages are not applicable – How about tenancy purchase
5 End User Financing
Once Equity Finance and End User Finance have been addressed, Construction finance is the easiest funding to secure – But, let the contractor do the hard work on this one !
5 Construction Finance
For the middle class, Incremental housing is a weak solution to the problem. However, for the poorest of the poor, it is the only option. This should be left to the Government.
6 Incremental Housing
Its is a not reasonable to expect the African middle class to pay for levies. This must be included in the cost of the house. Here is how.
7 Property Management
The only way to approach Affordable housing is to integrated the development process under one umbrella and cut the soft costs. Urbanis is the case in point.
8 Development Management
ArchitecturalDesign
Financial Structuring
ProjectManagement
Supply Chain Management
EquityInvestment
Operational Management
Construction Technology
The Zero Bill home should be the objective of every affordable housing developer. It is possible to achieve and has been done in England ( of all places !!)
9 Green Developments
The Role of the counties and government in general is to provide the land, infrastructure and guaranty the off take. The Developers can handle the rest !
10 Public Private Partnerships
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