Africa is rapidly growing as a continent in all sectors. Real estate is one of those fields. Thanks to several unique factors, the industry continues to expand as a business and investment opportunity.
1. Growing consumers
Africa currently has a growing middle class. That translates into more spending, meaning property developers have a ready market for their products. As African countries grow their economies, more people are getting the opportunity to improve their incomes and increase their overall net worth. They can afford to spend less money funding their expenses as time passes. The excess is funneled into investments, and a real estate is a popular form of investment all over the continent.
2. Infrastructure development
Additionally, Africa is investing heavily in infrastructure development. After decades of relying heavily on transport systems like primary roads and trains, more countries are building rapid train systems, bigger highways in rural areas, more airports, and fast road transit systems. As a result, previous;y inaccessible parts of the continent are opening up. That provides access to more real estate opportunities for developers and consumers alike. People can easily build commercial and residential spaces with better access to more land.
3. Demand for office space
There has also been a steady rise in demand for office space across the continent. Countries like Kenya, Nigeria, Rwanda, and more are receiving many business investors. Residents are also opening up their companies and increasing the need for commercial spaces for offices plus storage and supply. As such, property developers have to work overtime to construct more of these spaces and meet the growing demand. That has contributed to the growth of real estate in Africa.
- Population growth
Africa is also experiencing growth in the overall population of the continent. More people are starting families, and young professionals are moving out of their homes to begin their careers or further their education. That has led to a growth in the demand for residential spaces like apartments, hostels, and flats. The real estate business continues to benefit from filling this gap in the market, providing companies with a steady stream of rental income.
4. Demand for retail space
Thanks to the availability of a large market for retail, many retail stores are also opening branches across cities in Africa. These companies include both local and foreign retail giants. Good retail space in Africa is needed, creating another real estate market growth point. Developers are building malls, large stores, warehouses, and outlet stores all over the continent to make space for these businesses.
5. Local investment growth
Local African developers are also increasingly becoming involved in the real estate market. Aside from foreign real estate investors, there has been an uptake in the number of African-based real estate companies looking for growth opportunities within the continent. This has increased construction projects, property sales, real estate financing opportunities, and employment opportunities for real estate professionals. Therefore, the industry is growing from within itself as well as thanks to foreign investors.
6. Foreign investment
Speaking of foreign investors, one of the reasons why real estate in Africa continues to increase is the continuous entry of foreign investors into the African market. The continent is very attractive to investors due to a couple of reasons. For example, a lot of space is available where a business can start development projects. Also, many countries have streamlined their tax regimes to ensure they provide attractive offers to foreign investors. Additionally, the growth mentioned above in infrastructure has made it much easier for foreign developers to come into the continent and start their projects easily.
7. Labor market growth
Africa has also experienced growth in the real estate labor market. For example, many young professionals can go to school and study the real estate business to find out how it works and gain relevant skills. There are many institutions offering training programs. Also, learners can become certified real estate agents in their countries, empowering them to meet their client’s needs and business goals. Aside from colleges and training programs, Africans also have increased access to online courses and social media content covering various aspects of real estate.
8. Use of modern technology
Real estate in Africa is also growing thanks to the use of modern technology to run operations in the industry. There has been a steady rise in companies choosing to use systems that make processes more efficient. A great example is the use of online listings to market properties. These spaces allow users to purchase an apartment by simply looking through available houses from where they are located. Another benefit of modern technology is incorporating customer relations management (CRM) tools to run the business database and record relevant client information.
9. Use of investment funds
Next, we also use real estate investment trusts (REITs) as a tool for investors seeking to enter the real estate market. REITs allow interested parties to invest in the business without owning physical property. They do this by running income-generating real estate projects where clients can invest their money. Investors then earn dividends over time. These products have lowered the barrier to entry even further, allowing people to invest in real estate with relatively little money.
10. Affordable costs
In Africa, the cost of properties like houses and land is relatively lower than other assets. That is especially true in rural Africa, where land prices remain low and relatively affordable. As such, more people find buying land as an asset in their portfolio easier than looking for other investments. With an endless supply of properties and an increasing number of people with enough income, the buying and selling of property in Africa continue.
11. Availability of financing
Finally, Africa continues to offer a diverse collection of financial products for citizens and foreign investors. For example, many cooperative societies are created by groups of people designed to raise capital and invest it in products like real estate. Similarly, African banks offer investors unique funding opportunities, including housing finance, business loans, and mortgages.
Africa has a wealth of real estate opportunities available for all investors to utilize. The continent also has systems that make it easier for investors to enter the market and purchase property. Real estate in Africa continues to grow and offers a great business opportunity.