A CONTINENTAL MALAISE:
Here as in much of Africa, the shortage of housing is an unmistakable sign of a population that is growing very fast as well as the unintended side effects of rapid economic growth after decades of stagnation. Despite the considerable amount of construction that one will immediately notice cruising through the streets of Addis, the outstanding demand for housing runs into the hundreds of thousands of units. It is a legacy of a nation -indeed a continent--emerging from decades of economic malaise where the basic human need for shelter was has often been overshadowed by even more pressing needs.
Even as sustained economic growth takes root in Ethiopia and much of Africa, it seems that prospects for solving the significant housing shortages in this part of the world have not become easier. In fact, at the current rate of building here in Ethiopia, it may well take many decades to even make a dent. Unless Access Real Estate S.C.--one of the newer developers in Ethiopia--can do something about it.
BIRTH OF AN INDUSTRY:
Organized real estate in Ethiopia counts less than 2 decades under its belt. Still, despite being wrought with myriad issues since its inception, it is today at a level that far exceeds anything in its short history. Even so, it has not yet been able to even scratch the surface of the enormous pent up demand for housing in the capital city in particular.
The reasons for the very young age of the industry and the enormous gap that exists between its capacity and the enormous demand for housing i the city, have much to do with the draconian restrictions placed on real estate development during the Derg (previous government) era. But it would be accurate to say that even prior to the Derg's ascent to power, there had not been many organized attempts to develop housing on any significant scale either.
Upon the liberalization that followed the change of government, tentative moves into the real estate industry soon became a headlong rush and by 2005, over 400 real estate developers had been registered in Addis Ababa alone. Despite these numbers however, the very real challenges of launching successful housing projects here meant that in actuality, only a small fraction were active. Excessively long delivery times (sometimes as long as 7 years), poor quality and high prices defined the industry and its early focus was unmistakably placed on the high end of the market. Perhaps even more importantly, it did not display anywhere near the capacity to make even a dent in the enormous outstanding demand that existed in the capital delivering no more than 12,000 units in its lifetime against estimated demand for up to 500,000. Indeed it...