Angola’s real estate sector has only very recently begun to attract international investment interest. But with one of the highest rates of urbanisation in Africa the demand for real estate is enormous.
Post-conflict infrastructure, high import costs and the even higher cost of living in the country’s capital, Luanda has shielded Angola’s real estate sector from important international interest. However, times are changing and foreign business is beginning to recognise the extent of unmet demand.
International firms, mostly Brazilian and Portuguese companies, are leading figures in construction and real estate projects. The International Real Estate Company Century 21 recently started business in Angola. Most are focusing on Luanda – home to approximately a third of Angola’s population – but many are moving further afield to Angola’s other cities such as Huambo, Soyo, Lobito and Benguela.
Large-scale projects such as the Luanda Sky Centre are popping up all over the city. New buildings and cranes dominate Luanda’s skyline.
Investment momentum appears to be moving towards small and medium-sized housing projects. The demand for low-cost housing in Luanda is phenomenal. Angola’s booming economy and subsequent investment in infrastructure has opened Luanda and other Angolan cities to the international market.
Improved standards of living among the population is creating a surge in the domestic demand for low-cost housing. The government’s commitment to build one million houses in 4 years however is still unlikely to satisfy demand. International investment has an important role to play.
Customs duties for many construction materials have been significantly reduced by the government in an effort to encourage housing projects. Despite multiple cement factories, the demand is so high that the majority of cement is imported. Domestic construction material production is an investment priority but demand is likely to outweigh supply for the foreseeable future.
In 2004, the Angolan parliament passed the Law on Land and Urban Planning affirming state-ownership of all land. Long-term renewable leases, however, ensure effective private ownership. Owners are legally required to agree to a five-year gap between buying and selling of leases.
The Angolan Real Estate market is building up economic momentum and is set to become a vibrant commercial sector. Substantial investment in infrastructure and raising living standards secure the short to mid-term sustainability of Angola’s real estate market.
International investment is needed to propel the process and ensure the economic staying power of a flourishing residential and commercial real estate sector.