Housing Mortgage Financing In Africa 2010-2018

The importance of a well-functioning mortgage market cannot be underestimated when it comes to addressing the long-tern growth of demand for housing in Africa. Our objective is to examine the causal relationship between housing mortgage volume and macroeconomics factors as well as institutional characteristics. The data we are using is a panel data set consisting of around 30 countries across Africa over the period 2010-2018. Our main contribution is that we are utilizing a data not only on mortgage depth, GDP, population growth, urbanization and construction investment as well as mortgage interest rate and mortgage term. We are also using information about deed registry, how many properties that have a deed, how long time it takes to register a property and the cost to do it. The data comes from Center for Affordable Housing in Africa. The estimation strategy we are using is a fixed or random effect model. Our results indicate that GDP per capita is the major macroeconomic factor explaining total mortgage debt. However, GDP per capita alone can only explain a small part of housing mortgage debt. Other important factors explaining the variation in mortgage debt are urbanization and deed registry. What policy implications can we draw from our results? Besides a stable long-term sustainable economic growth, there is need of a housing policy that specifically addressing the housing mortgage market. Here is a deed registry of highest importance.