Statistics indicate that a single house costs about Rwf20 million. This means that total housing demand would require a financing package of up to Rwf500 billion per year

Rwanda needs about 25,000 housing units per year, a basic right for her citizens, quoted in the Istanbul Declaration, according to statistics from the Ministry of Infrastructure.

Linda Bihire, the Minister of Infrastructure, said that the estimated demand is for housing in the urban centers of the country only.

In a breakdown, Kigali city alone demands about 10,000 housing units per annum. The combined demand for housing in the rest of the country’s urban centers is estimated at 15,000 units per annum.

A presentation on Rwanda’s construction sector during the Construction/Real Estate Investment Roundtable that ended yesterday also indicated that, "The demand for construction of residential housing is increasing at a rapid rate with the urban population of 1.9 million growing at 4 percent per year.”

"Although the demand for housing has grown, involvement of the public and private sector has not improved much from the 10 percent that was registered in 2003,” Bihire said.

Last year alone, the construction growth rate was estimated at 16 percent. Information presented at the Serena Hotel also  indicate that planned settlements are the preferred and accepted form of housing development in urban areas, which require massive investments.

The National Bank of Rwanda (BNR) statistics indicate that a single house costs about Rwf20 million as of last year. This means that total housing demand would require a financing package of up to Rwf500 billion per year.

Kigali city, according to the ‘City Master Plan’ has construction projects worth $600 million.

Currently, Rwanda’s construction sector is largely financed by mortgages. However, the Central Bank Governor, François Kanimba, said that though the current demand for mortgage finance is much higher, its total supply remains far below the demand.

"This is because the banks’ capacity to sustain the past growth in real estate loans is constrained by the duration mismatch,” he said.

There are currently three housing specialised banks such as Housing Bank of Rwanda (BHR) and eight commercial banks in Rwanda. Only four of these embrace mortgage financing.

Unfortunately, an official who spoke on conditions of anonymity revealed that Rwanda Commercial Bank (BCR), one of the mortgage financer, has suspended the programme owing to the global credit crunch.

There are also a great number of estates which were developed by institutions such as the Social Security Fund of Rwanda (SSFR) and privately owned property developers like Tri-Star Investment.

SSFR has about eight ongoing real estate projects. In order to finance in a sustainable manner, real estate sector, Kanimba explained that, "Rwanda needs to mobilise long term domestic savings.”

The pension reforms to regulate and supervise social security activities in Rwanda are expected to stimulate long term domestic saving.

The construction sector is also one of the key sectors of the economy in Rwanda. Rwanda Development Board (RDB) statistics show that investments in the sector have grown from $100 million to $351 million over the last five years, representing a 28 percent increase.

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