City of Kigali moves to bridge affordable housing deficit

The schematic plan of Batsinda II affordable housing project

In the National Leaders Retreat last year, Rwandan policy makers were tasked with addressing the pressing challenge of inadequate supply of affordable residential houses that was tagged a threat to individual economic growth of Rwandans, especially within low and middle income earning segments of the population abiding in cities.

The challenge, though identified as a national threat to development, was and still is more eminent in Rwanda’s capital Kigali, but also is a rising matter of interest in earmarked secondary cities including; Nyagatare, Huye, Rusizi, Musanze, Muhanga, and Rubavu towns.

A year later, the City of Kigali in partnership with other institutions within the infrastructure domain like the Infrastructure Ministry and the Rwanda Housing Authority has embarked on addressing this challenge.

In an earlier survey in 2012 that sought to mark opportunities and showcase the current status of the housing market in Kigali, it was identified that more that 344,068 house units were required by the year 2022, if the city is to adequately shelter its rapidly growing population.

To be able to provide adequate housing by that time, more than 40,000 house units would have to be constructed each year for the next seven years.

City authorities and partners are already taking the lead in constructing some affordable houses for the lower end market segment in Kigali.

Against this backdrop of a required involvement of government in upping the supply of affordable shelter for urban residents, the City of Kigali (CoK) in partnership with the Rwanda Social Security Board (RSSB), the Rwandan Ministries of Infrastructure and Defense, on February 28th hosted a groundbreaking ceremony in Batsinda sector of Gasabo district within Kigali.

The project codenamed Batsinda II will begin with the initial phase of 609 units of affordable houses; constructed as a joint investment of the government of Rwanda and RSSB.

Batsinda II will constitute of low-rise apartment houses ranging from two and four bedroom self contained structures.

The costs of the houses will also range between Frw15 million to 30 million.

According to the Minister of Infrastructure James Musoni who was speaking at the event, affordable houses in Rwanda are expected to at least not exceed the cost of Frw30 million.

“The houses will have different costs depending on people’s incomes. However By affordable we mean the most expensive house should not go beyond Frw30 million,” Musoni explained.

Financial institutions to play key role by ensuring access to finance

 

As Musoni exhorted, Rwandans should now take on to the available financial institutions and begin to save as much as they can for their future home.

Products like Gira Icumbi at the Development Bank of Rwanda (BRD) and other financial institutions are seen as crucial in enabling Rwandans especially those in urban settlements to own good quality shelters in the near future.

Gira Icumbi is a BRD product which was designed to enable people save for at least one year, raise about 10% of the cost of their dream house and then be able to access a credit facility to own the house.

Batsinda II as expected will be completed in less than two years, but as reiterated by CoK Mayor Fidele Ndayisaba, several other projects are already underway or will be initiated in the course of the next two years, and in various parts of the city.

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Minister Musoni, Mayor Ndayisaba, BRD’s Kanyankole at Dubai’s (front row in black suit) affordable housing Estate in Kinyinya

Many other projects underway

“This and other similar projects planned or already being implemented present the beginning of overcoming the problem of limited supply of affordable houses in Rwanda,” the Mayor shared of his and the government’s conviction.

Batsinda II is one of five affordable housing projects in the City of Kigali revealed by authorities at the event.

Others include, Ziniya Pilot Project where 128 units will be constructed, Ndera Affordable Housing Project with 2000 units, Rugarama project and its 2,743 units and Kanombe Affordable Housing Project where another 2,000 units are expected to be delivered.

According to Minister Musoni, it is imperative that all proposed projects be constructed in form of low-rise apartments, in order to ensure that the limited land available for settlement as indicated in the City Master Plan is effectively used to adequately shelter Kigali’s dwellers.

For instance in the Batsinda II Affordable Housing Project, one hectare of land as proposed will carry 83 units, compared to 60 units that are ordinarily planned for such a size of land.

In other projects based on topography and other land related factors, one hectare of is projected to hold 70-100 units.

Government joint ventures in affordable housing are demystifying risk and opportunity in the sector

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One of the affordable housing estates being developed in Kinyinya Kigali

However as identified in the 2012 survey mapping the current status of opportunities in the housing market, most of the investment that would see the required number of units attained was expected to come from the private sector.

But for a long time, the private sector did not seem interested in this market as many developers were focused on the lucrative high income segment, where constructing a few structures would offer a big profit margin.

Thus like it has been in the last two decades, the government would have to first break open this virgin market, showcase the available opportunities, and present the right technological and financial compositions that can be used to execute mega development projects such like Batsinda II.

And perhaps as expected, several private developers are already taking up the challenge; to supply affordable houses, in and around Kigali City.

Nsabimana John alias Dubai is one of the proprietors who have seen the opportunity and are taking up the challenge of meeting Kigali City market’s need for affordable housing.

At his Urukumbuzi Estate in Kinyinya also of Gasabo district, Nsabimana has so far built in excess of 300 units, and as claimed in various surveys, he attests of a high demand for houses such as his.

Up till today, he is constructing on demand, meaning before he even begins to develop; his house will already have been booked and part of the cost paid.

Nsabimana claims that his main emphasis, just like the government needs, is to offer cost friendly houses that will enable many Rwandans own homes, and facilitate them to kick start their journey to economic wellbeing and wealth creation.

“Currently, I am building houses that cost between Frw17.5 to 30 million. But in about a month, we expect to have a proposal to build even more affordable houses that will go for as low as 10 to 15 million.”

With private, public and public-private partnerships projects in affordable housing already taking shape, stakeholders especially city dwellers are already optimistic that the housing challenge will soon be met.

“No better news than this, this is the way to go,” several locals present at the launch of the project exclaimed.

Others were already wondering how to buy such houses, to which Mayor explained that the city will deal mainly with financial institutions.

 

  • By MATTHEW RWAHIGI
  • Posted 20th March 2015

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