Analysis Of The Factors That Influence Housing Affordability In Kigali City
Abstract
Rwanda is one of developing countries facing the challenges associated with housing. Those
challenges include among others, inadequate provision of housing especially for low income earners,
infrastructure development, scarcity of land loans and mortgage availability.
The main objective of this research project was to analyze factors that influence housing
affordability in Kigali City while specific objectives were to determine the level of housing supply
and demand in Kigali City, to identify significant factors that influence housing affordability in
Kigali City and to determine the contribution of each factor to housing affordability in Kigali City.
The methodology was based on a questionnaire survey distributed to households to collect primary
data. A sample size of 93 households within the 3 Districts of Kigali City was targeted. A semistructured
questionnaire was administered to selected respondents of 93 heads of households.
Household survey, field observation, key informant interviews and focus group discussions were
used to complement questionnaire data. A desk-review was used to review documents at both global
and country levels related to housing affordability for secondary data. The analyses were done using
qualitative and quantitative approaches with the aid of the (SPSS) Statistical Package for Social
Sciences software.
The study results revealed that the level of housing supply in Kigali City is low while the level of
housing demand in Kigali City is high. Fifteen significant factors that influence housing affordability
in Kigali City were identified and those are institutional structure affecting housing finance, cost
and availability of finance for housing, income, household growth, interest rates and mortgage
availability, property related taxes, child care, wealth, employment, infrastructure costs, costs and
availability of land, cost of professional services and house price and rental costs, shopping facilities
and finally tax concessions for both owner-occupied and rental housing.
The contribution of each factor to housing affordability in Kigali City was analyzed by a correlation
analysis that indicated that there are 11 factors which contribute to housing affordability in Kigali
City with respect to their relationship between those factors and housing affordability and those are
wealth, household growth, cost of interest rates and mortgage availability, employment,
infrastructure costs, property related taxes, income, cost and availability
v
According to the research findings, recommendations for policy makers were drawn whereby policy
makers should promote the use of modern methods and construction materials which will contribute
to providing high quality housing in a short time and for Kigali City managers, they should contribute
in providing housing cooperatives to increase availability of finance for housing for low income
earners. For further research, it would be necessary to do studies on whether homeowners and renters
perceive their housing costs as affordable or unaffordable. This could be compared to quantitative
data on housing cost and income to provide further insight in to the various housing affordability
measures.
Publisher
UoN
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