BY ANTONY MUTUNGA
Urbanization has been rising across Africa – most people are moving to urban places to improve their living standards. And the trend points to a need for housing, which continues to be elusive, especially to those with low buying power, who are constantly forced to stay in informal settlements and slum areas.
In Kenya alone, there is an estimated need for over 350,000 units every year to accommodate the growing population in urban areas. That is why the government turned to an affordable housing strategy to increase the number of units. But, barriers still exist.
Information asymmetry in the industry is a major stumbling block. More often than not, lack of information caused the real estate sector to lose investors as those willing to invest are always forced to start by doing research, which is generally time-consuming.
The good news is that Open Access Initiative (OAI) is expected to change the situation. The initiative is spearheaded by the Centre for Affordable Housing Finance in Africa (CAHF), Financial Sector Deepening (FSD) Africa Investments, Financial Sector Deepening (FSD) Kenya, and Reall and International Housing Solutions (IHS), and aims at building up a repository of shared data, experiences, and tools for improving efficiency and scale of affordable housing development across the African continent, and eventually beyond.
The initiative will also ensure members of the public are informed in terms of access to data on the cost of construction, time taken to complete projects, and specific challenges arising in the housing sector. There has always been limited access to information, especially about the target market, the affordability of houses, financial pressures buyers felt, investment performance, and milestones achieved on the housing front.
OAI will be able to highlight the opportunities and risks involved through four main steps: data collection, assembly, the production and delivery of outputs, and then advocacy and dissemination engagement. Kenya will be the pioneer as the initiative will be piloted.
Affordable Housing Investment Alliance (AHIA) will drive the initiative in the African continent with higher hopes of producing a wide range of outputs such as project fact sheets, investment fact sheets, action briefs, and case studies as a data dashboard targeting different groups.
The alliance has revealed that besides market development to build and support a more competitive environment in which a range of market players see investment opportunities, OAI will primarily contribute towards overall cost saving on a housing project and time taken to achieve delivery, benefiting not only the investor but the data holder and the market as a whole.