In a bid to accommodate an estimated 22 million people by 2050, Rwanda aims to increase its housing units from 2.5 million in 2019 to 5.5 million. The Rwanda Housing Authority has identified affordable housing as a key strategy to meet this demand. However, a recent report by the Committee on Land, Agriculture, Livestock, and Environment in the Chamber of Deputies has highlighted several pressing issues obstructing the delivery of this housing scheme. The report, presented on August 7, has prompted calls for the Ministry of Infrastructure to urgently address the bottlenecks, including through extending incentives to investors. Investor interest Marie Alice Kayumba Uwera, the chairperson of the committee, raised concerns on limited investor interest in affordable housing projects. Scarcity of investors could potentially hinder the achievement of the set targets. For instance, the City of Kigali which aims to construct 18,000 affordable houses annually to meet its residents' accommodation needs, has managed to build only 1,800 such houses over the past three years. Delays in basic infrastructure development The report reveals persistent delays in establishing basic infrastructure, including water, roads, electricity, and waste management facilities. These amenities are crucial incentives for investors in the affordable housing sector. ALSO READ: Foreign investors eye Rwanda’s affordable housing scheme Abandoned projects Financial constraints have led to contractors abandoning affordable housing projects. One example is a project in Ndera, Gasabo District, where an investor withdrew from the scheme due to financial difficulties. Unutilised land The report highlights the issue of government-owned land that remains undeveloped despite being allocated for affordable housing projects. The government's establishment of a land bank, aimed at reserving undeveloped land for future affordable housing initiatives, has not been fully utilized. Notably, land purchased in Kicukiro and Gasabo districts remains untouched. Quality concerns The report cites Substandard construction as a significant challenge in delivering quality affordable housing. Instances of shoddy construction, like the case of Urukumbuzi real estate, have been highlighted. Lack of adequate inspection and mechanisms to penalize those responsible for subpar construction exacerbate the issue. ALSO READ: Kigali’s affordable housing projects drag on at slow pace Income discrepancies Many affordable housing models are still out of reach for low-income earners. Statistics by the National Institute of Statistics indicate that around 54% of Kigali inhabitants fall within the low-income bracket, earning between $38.0 and $225 a month. The current affordable housing programme's income range of Rwf200,000-Rwf700,000 excludes a significant portion of the population. Escalating costs and borrowing challenges Expensive construction materials and material shortages have contributed to delays in affordable housing development. The committee underscored the scarcity of locally produced construction materials. Additionally, high borrowing costs from banks, exacerbated by the Covid-19 pandemic's impact on supply chains and transport costs, have hindered real estate developers' progress.
