Luxury-heavy pipelines leave African buyers behind, housing report warns
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A Housing Development Advocacy Network report says African developers are building for a buyer class that does not exist in sufficient numbers, leaving affordable stock underserved even as demand for housing keeps rising.
A new report by the Housing Development Advocacy Network (HDAN) warns that real estate development across Africa is drifting away from the households that need housing most, with developers concentrating on luxury apartments and high-end residential estates while low- and middle-income earners struggle to secure decent accommodation at affordable prices.
The report, reported by Tribune Online, argued that the problem is not a lack of demand but a mismatch between the product being built and what most households can pay. "A developer may construct dozens of luxury apartments costing hundreds of millions of naira, while thousands of working-class families within the same city struggle to afford modest homes," the report said, adding that the imbalance risks creating oversupply in some property categories while leaving the affordable segment significantly underserved.
HDAN said the growing gap between property prices and household incomes is now a central challenge for African developers. Rising construction costs, land prices and financing expenses are pushing selling prices up to protect margins, which in turn shrinks the pool of buyers able to transact, particularly in markets where mortgage financing remains out of reach for most of the population. "This creates a difficult situation for developers. While the need for housing continues to grow, the number of people capable of purchasing newly built properties may remain limited," the report said.
The advocacy network warned that over-concentration on the luxury segment leaves developers holding unsold stock, stretching marketing periods and tying up capital that could otherwise be deployed into new projects, producing a market where strong underlying demand does not translate into sales or sustainable investment returns.
Instead, HDAN urged stakeholders to judge delivery not by the number of buildings completed but by whether homes are affordable, appropriately located and backed by accessible financing. It called for a shift towards housing models that reflect local income levels and household needs, including smaller units, cost-effective construction methods, sites with access to employment, and partnerships that widen mortgage access.
Without those adjustments, the report concluded, rising housing costs could keep undermining investment returns while excluding millions of households from formal homeownership.