Supply of land puts pressure on house prices

A serviced plot in Keetmanshoop costs about N$20 000, while the same size erf in Khomasdal costs N$225 000.

15 June 2021 | Infrastructure



The rising supply deficit in land servicing and delivery continues to put pressure on house prices.

It costs about N$593 897 to build a three-bedroom house in Windhoek, compared to N$388 003 for the same house at Keetmanshoop, due to varying land prices.

A plot measuring 375 square metres in Windhoek’s Khomasdal suburb, which is considered a middle-income area, costs 11 times more than the same size plot in Keetmanshoop’s middle-income residential area.

Taking into consideration all costs involved in the house construction value chain, land accounts for 5% of total cost in Keetmanshoop while in Windhoek it accounts for 38%.

This is according to the latest report by First Capital, which monitors housing trends in Namibia.

It compared construction costs in Windhoek, Keetmanshoop, Swakopmund, Ondangwa, Rundu and Katima Mulilo in March this year.

Building materials

The report found that the cost of building a standard three-bedroom house is around N$449 659 in Swakopmund, and around N$399 895 in towns such as Rundu, Ondangwa and Katima Mulilo.

Building materials remain the most significant cost component in the house construction value chain, on average accounting for more than 60% of the total cost for building a new house.

“The cost of building materials remains higher in northern parts of the country relative to central and southern parts,” according to the report.

On average the building materials needed for a standard three-bedroom house cost N$254 302 in Katima Mulilo, Ondangwa and Rundu while the same materials averaged N$252 692 in Keetmanshoop, Windhoek and Swakopmund.

“The differences in building materials cost by town reflects varying prices due to supply sources that are largely unique to every town.”


The cost of a serviced plot measuring 375 square metres is the cheapest in Keetmanshoop at N$19 922, followed by Rundu at N$29 574.

The same size of land would cost N$225 396 in a middle-class area such as Khomasdal in Windhoek, making it the most expensive, followed by Swakopmund at N$80 878.

“Though average growth of land prices has declined from the five-year average of 9% to 6% year-to-date, land still remains exorbitantly elevated, especially in Windhoek and coastal towns. High prices of land in Windhoek and coastal towns can be explained by the higher demand as opposed to the supply of land in these towns.”

The report says that other than land being costly in these towns, the rising supply deficit in land servicing and delivery continues to put pressure on prices.

“However, this research concludes that other than the mismatch between demand and supply of land, inefficiencies in servicing of land as well as speculative motives among private developers equally contributes to high urban land prices.”

Land prices are expected to remain persistently high, which continues to be a limiting factor in acquiring residential properties, especially in the central and coastal parts of the country.

The report added that relative to previous years budgetary allocations for land servicing and housing remain low.

It said the scope for increasing public spending on housing remains limited, partly due to pressure to increase social spending and rein in the spending ceiling.

“This is expected to undermine the effort to deliver on housing and urban land. Given the high housing backlog currently estimated at 300 000, the housing budgetary allocations remain low although useful to make a notable dent in the housing market but its impact could be undermined by low private sector investment appetite to develop informal settlements.”

Similar News


Action required to reach water goal

2 weeks ago - 06 July 2021 | Infrastructure

ELLANIE SMITWINDHOEKAfrica needs to put in place strategies for progress to accelerate progress towards achieving the Sustainable Development Goal (SDG) 6, which deals with ensuring...

Mass housing available in Ehenye

4 weeks ago - 25 June 2021 | Infrastructure

Tunohole Mungoba – OshakatiIn collaboration with Sarna Properties and Warthog Engineering, residents from northern Namibia and beyond will soon be new homeowners for two- to...

Supply of land puts pressure on house prices

1 month - 15 June 2021 | Infrastructure

ELLANIE SMITWINDHOEKThe rising supply deficit in land servicing and delivery continues to put pressure on house prices.It costs about N$593 897 to build a three-bedroom...

New desalination plant for Namibia

1 month - 08 June 2021 | Infrastructure

Govt partners with private sector to save money > >OTIS DANIELSSWAKOPMUND“Another desalination plant for Namibia is no longer merely a potential, but a reality as...

City secures N$11m to upgrade Gammams plant

1 month - 01 June 2021 | Infrastructure

NAMPA WINDHOEKThe City of Windhoek has received a non-repayable grant from the Kreditanstalt für Wiederaufbau (KfW) Bank to the tune of...

Building houses the unconventional way

2 months ago - 11 May 2021 | Infrastructure

RIVALDO KAVANGAWINDHOEKThe Standard Bank Group, the Massachusetts Institute of Technology (MIT) and the Shack Dwellers Federation are busy with a pilot project that will use...

Passionate about providing housing

2 months ago - 07 May 2021 | Infrastructure

Michelline NawatisesPull quote: “We look to provide homes to as many Namibians as possible.” – Brenton Kuss – Managing Director of Namibia International CapitalNamibia International...

Quality and affordable housing – a key to a...

2 months ago - 07 May 2021 | Infrastructure

Michelline NawatisesThe National Housing Enterprise and Shelter Afrique signed a memorandum of understanding on 30 April at the headquarters of NHE in Eros, Windhoek.Shelter Afrique...

Water supply and sanitation improves

4 months ago - 04 March 2021 | Infrastructure

ELLANIE SMITWINDHOEKThe supply of water and sanitation facilities in rural areas has improved significantly over the past three decades, according to official statistics.Since independence, a...

Otweya housing project kicks off

5 months ago - 17 February 2021 | Infrastructure

LEANDREA LOUWWALVIS BAYThe ground-breaking ceremony and construction commencement of 121 houses at the Otweya informal settlement took place in Walvis Bay on Monday morning.The minister...

Latest News

CRAN, MTC on collision course...

1 hour ago | Technology

OGONE TLHAGE WINDHOEKThe Communications Regulatory Authority of Namibia (CRAN) has warned telecommunications giant MTC...

Erongo hospitals have space, Jonas...

1 hour ago | Health

IRENE-MARI VAN DER WALTSWAKOPMUNDHospitals across the Erongo Region have adequate space, health director Anna Jonas says.She encouraged the public with Covid-19 to seek medical attention...

Is Covid targeting children?

1 hour ago | Health

JEMIMA BEUKES WINDHOEKThe health ministry is at a loss of words after Namibia recorded seven times the Covid-19 child deaths of the...

Dreams do come true

1 hour ago | Sports

JESSE JACKSON KAURAISAWINDHOEKMTC Namibia has made the dreams of young sprinters Beatrice Masilingi and Christine Mboma come true with the biggest sponsorship yet of individual...

O&L Leisure to temporarily close...

1 day - 22 July 2021 | Business

Jo-Maré Duddy - As part of “urgent rescue measures to safeguard the future sustainability of its business and mitigate the risk of the impact on...

New electronic transfer system to...

1 day - 22 July 2021 | Economics

A new electronic funds transfer system has been gradually introduced into the Namibian market, with all stakeholders in the banking industry collaborating on the wide-ranging...

Katjavivi rapped over knuckles for...

1 day - 22 July 2021 | Justice

MATHIAS HAUFIKU WINDHOEKJudges hearing the appeal in the matter between National Assembly Speaker Peter Katjavivi and suspended Landless People’s Movement (LPM) leaders...

Govt to fight AR over...

1 day - 22 July 2021 | Agriculture

ELLANIE SMIT WINDHOEKThe government intends to fight a lawsuit in which Affirmative Repositioning (AR) activist Job Amupanda demanded the removal of the...

MPs ‘scared’ of LPM leaders

1 day - 22 July 2021 | Government

MATHIAS HAUFIKU WINDHOEKLawmakers fear that their safety will be in jeopardy if Landless People’s...

Load More