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Africa is rapidly urbanizing and will
lead the world’s urban growth in the coming decades.
Currently, Africa is the least‐urbanized continent,
accommodating 11.3 percent of the world’s urban population,
and the Sub‐Saharan region is the continent’s
least‐urbanized area. However, the region’s cities are
expanding rapidly, by 2050; Africa’s urban population is
projected to reach 1.2 billion, with an urbanization rate of
58 percent (UN‐HABITAT 2014). With this rate of growth,
Africa will overtake Asia as the world’s most rapidly
urbanizing region by 2025 (UN 2014). Although the nature and
pace of urbanization varies among countries, with over a
quarter of the world’s fastest growing cities, Africa is
undergoing a massive urban transition. Globally, cities are
major drivers of economic growth, and the quality and
location of housing has long-term consequences for inclusive
growth. However, in Sub-Saharan Africa, urbanization is not
accompanied by the level of per-capita economic growth or
housing investment that is observed elsewhere in global
trends. Incomes in Sub‐Saharan Africa (SSA) have not kept
pace with urbanization, which, in many African countries,
has not necessarily been accompanied by industrial growth
and the structural transformation as has occurred in other
regions. Housing stocks, along with investment and
employment in related construction and finance industries,
constitute a major component of national economic wealth.
The key challenge for African cities, however, has been the
comparatively low growth in per‐capita income, which limits
the resources that households have to consume or invest in
housing. At the same time across the region, the formal
channels through which quality housing is produced and
financed face major constraints that limit access to a large
share of urban households. Hence, the formal housing sector
is only a small part of the economy because the construction
and finance services have very little effective demand,
evidenced by the lack of formal investment in housing across
the region. Recent studies have found that in Africa, formal
housing investment (in national current accounts data) lags
behind urbanization by nine years (Dasgupta et al. 2014).
Furthermore, the capital investment in infrastructure needed
to handle rapid urbanization typically happens (if at all)
after housing has already been built, often in informal settlements.
