A study to investigate the housing market and explore cost-effective and efficient building materials and technologies has been completed. It examined both demand and supply of affordable housing in Rwanda, with the aim of providing a comprehensive view of the market.

The study’s principle is that housing is vital for both people and the nation. For households, it is likely to be the most significant investment they will make in their lifetime.

The Development Bank of Rwanda (BRD), in collaboration with the Ministry of Infrastructure (MININFRA) and the Rwanda Housing Authority (RHA), has been tasked with assisting the government in achieving two objectives for the upcoming affordable housing programme.

One of the objectives is to maximise the performance of the house as a private asset, and secondly, to boost the performance of the housing sector as a national asset, capable of meeting the needs of the city and the economy broadly.

According to Fatou Dieye, a consultant team leader, the study reconstructs ten years of research and policy interventions, cross-examines a remarkable data landscape, and draws from practical knowledge gained on construction sites across the country.

"This information is a valuable guideline for shaping future policy orientations in line with the objectives of Vision 2050 and the upcoming national strategy for transformation.”

Dieye explains that the recommendations outlined in the study aim to improve access to good quality accommodation through a construction industry that prioritises affordability, job creation, environmental protection, and sustainable development.

In her speech, Patricie Uwase, the Minister of State in the Ministry of Infrastructure (MININFRA), explained that this launch had been long-awaited as it required significant effort to address the housing issue in the City of Kigali.

"As we continue to discuss the results of the report, we find practical solutions for a common ground,” she said.

She emphasised that the report is crucial in the urbanisation of rural settlement agenda, because it supports the Vision 2050 commitment to ensure universal access to affordable and decent housing.

Uwase highlighted that, as the future drivers of growth in the country, the objective is to achieve a 70 per cent urbanisation rate by 2050. She stressed that, at the ministry level, there are already discussions in place to achieve a formal working sector.

"This will result in moving from one household at a time to a national perspective.”

"Our collaboration has so far created some results, there is an urbanization policy and strategy in place, and implementation framework, and we are working towards a broader national housing strategy,” she added.

She also mentioned that the tangible results on the ground and the dissemination of the findings support alignment and collaboration. She added that the analysis provides evidence for decision-making, which is expected to bring about a change.

The findings on the income capacity of urban households, with close to 70 per cent of them earning less than Rwf 300,000, show the need for growth for rental housing.

"Recommendations consider all components of the housing value chain, we should see the change also happening at every step for the materials, labour, and everything else that needs to make it a more predictable and formal sector,” the minister said.

Uwase commends the government’s commitment to supporting the provision of affordable and decent housing to focus on the low-income population especially.

"We are in partnership with a team of experts, and anticipate observing results implemented.”

According to Jean Claude Iliboneye, the financial institution representative and head of the business department at BRD, the bank is playing a significant role in addressing the issue of affordable housing.

The bank provides funds to financial institutions mainly dedicated to mortgage loan seekers.

"Through the Rwanda Housing Finance Project (Gira Iwawe) funded by the World Bank to the tune of $150 million, BRD offers a highly subsidised interest rate of no more than 11 per cent to the end beneficiary, and the results have been transformative.”

Iliboneye noted that prior to the initiation of the Gira Iwawe project, the interest rate for accessing mortgage financing ranged between 17 and 18 per cent. The repayment period for the loan was short, and the ability to borrow a sufficient amount to own a mortgage or purchase a house was extremely limited.

Currently, there is the ability to borrow more in order to acquire a suitable house that aligns better with the master plan's directives. BRD also created a platform https://giriwawe.brd.rw/ that enables individuals with a household income of less than Rwf 1.2m per month to obtain mortgages at not more than 11% per annum and household income between Rwf 1.2m – 1.5m per month to obtain mortgages at not more than 13% per annum.

"In partnership with Rwanda Housing Authority (RHA), once a person applies in the system, RHA assesses their eligibility into the affordable housing scheme, and the eligible applicants are automatically linked to the participating financial institutions,” Iliboneye said.

BRD is also providing financing to the developers through the Hatana/ERF2 fund for those who are building affordable housing units where sixty percent (60%) of the cost of the Made in Rwanda construction materials is financed at a reduced rate of eight per cent (8%), and the rest of the project cost is financed at market rate of approximately 16 or 17 per cent leading to a blended financing of not more than twelve percent (12%).