Mozambique to build 35,000 affordable housing units

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Mozambique has signed an agreement with Chinese contractor, CITIC Construction to construct 35,000 affordable housing units in four provinces.

The agreement which was signed between CITIC Construction and Housing Promotion Fund (FFH), a body supervised by the Mozambican Ministry of Public Works is intended to build houses meant for young people and workers in the public administration.

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Affordable housing units

Construction of the housing units is set to begin next year and will take five years to complete. 15,000 houses will be built in the southern provinces, 10,000 in the centre of the country and 10,000 in the north. Each house will cost between US $30,000 and US $40,000 depending on the size, with possibilities of payment phased over a long period of time.

Chinese ambassador to Mozambique, Liu Xiaoguang, said that the grand project, which will be delivered as a public-private partnership, encompasses construction of roads, electricity, water and other utilities. Minister of Youth and Sport, Nyeleti Mondlane, on his part congratulated the two sides on reaching agreement.

“Access to decent housing is a key issue for young Mozambicans. This is a very good initiative for Mozambican youth as they are clamoring for the opportunity to live in decent houses of their own,” said Nyeleti Mondlane.

Housing affordability in Mozambique is severely constrained. Construction costs are estimated to be 30% higher than in neighbouring South Africa, as a result of higher material costs, low labour productivity and high financing costs. A small percentage of construction materials are locally manufactured; most materials are imported from South Africa, Portugal and China.

Majority of the population earns less than US $100 a month. Banks offering mortgages have a minimum loan amount of US $5 000, which is far out of reach of the majority, yet still far less than the cheapest house in the market.