Unpacking Namibia’s Housing Dilemma

I have been studying the labour market and the housing market as they are two of the most critical pillars in any economy. 

In the process, I realised how a good political decision can sometimes have bad economic outcomes.

If houses were simply goods for consumption, the economic forces that determine their availability would simply be a function of how many people already have homes, how many don’t, and how many more are needed. 

But because housing is also an investment tool, it is far more complex. 

Homes become financial assets that influence prices, availability and who benefits from the market. 

Windhoek’s housing system reveals an uncomfortable truth: It isn’t broken, it’s functioning exactly as designed. 

It works for banks, developers and speculators, but not for the average Namibian who simply needs a place to call home.

ELITE DOMAIN

Housing in Windhoek has increasingly become the domain of banks, property funds and corporate developers. 

They acquire land from the municipality, build gated communities or apartment blocks, and rent or sell them at prices designed to maximise returns. 

Their focus is profit, not providing affordable shelter. 

Meanwhile, ordinary Namibians are pushed into credit dependency, taking out mortgages that feed a system of mortgage-backed securities. 
Bankers understand the housing market is key to creating securities in a strong financial system. 

As property prices rise, so do the values of these securities, rewarding the very system that makes homes increasingly unaffordable for the average person. 

Mortgages tie individuals to decades of debt. 
As central areas become unaffordable, people move to cheaper suburbs, only to see demand and rent rise there too.

Even informal housing is expensive. A retail worker earning N$3 000 may pay over N$1 000 for a shack without electricity or water. 

According to reports, Namibia’s mortgage debt is approximately N$45.7 billion, making it the largest component of household debt. 
These debts enrich investors while driving up costs for everyone else.

LOCAL GOVERNMENTS

Municipalities like Windhoek control vast amounts of undeveloped land that could help ease the housing crisis. 
However, they face a dilemma because of the nature of the housing market.

They must decide whether to sell land to ordinary citizens or to investors and corporate developers who can pay more.
The municipality reportedly needs billions of dollars to service this land. 

As a result, they are often forced to sell land to investors who can pay higher prices. 

This encourages housing being regarded as an investment rather than a consumer need.
According to recent reports:

• Windhoek’s waiting list for serviced land is 40 580 households. 
• Windhoek’s informal settlements are growing at 6.1% a year. 
• About 40% of the city’s population lives in over 130 informal settlements. 
• The urban housing backlog has surpassed 72 000 households. 
  The issue should not be seen as a market problem. We must consider the ABCs of any market: Supply and demand. 
  The fix is not complicated. If housing demand is very high, we need a corresponding supply of affordable housing and serviced land, especially from our vast municipal land reserves.
  We can’t regulate our way out of a housing shortage. 
  We need to appeal to those in charge of municipal land policy to change their approach and to see housing more in terms of consumption than purely as an investment.

ECONOMIC GROWTH

I believe many of our economic problems will be addressed if we solve the housing crisis. 
Affordable housing is not just about providing shelter; it is a catalyst for economic growth. 

It is a key factor influencing the widening gap between the haves and have-nots, as housing costs deepen inequality.

Rent-to-income ratio is an important measure of affordability. Anything above 30% is considered a housing cost burden. 
For many Namibians, this ratio is far above 30%; for some it can approach 100%, leaving little or nothing for savings, education or investment.

Moreover, many small businesses close down because of  unaffordable rent. 

This affects entrepreneurship, limits job creation and stifles local economic growth.

To address this, we need government subsidies to make affordable housing accessible to those who need it most. 

Such subsidies can lower costs and stimulate construction.
I often reflect on how much more effective the fight against poverty could have been if the previous administration had made housing reform a priority. 

I sincerely believe housing reform could be the defining line between the success or failure of the current administration – something many of us still  hope for.

• Domingo /Goagoseb is the author of the book ‘Revival: A Biblical Perspective’. These are his personal views and do not represent those of any organisation.

In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.