Ronald Chitotela (centre)
Ronald Chitotela (centre)

Zambia faces a huge housing deficit that has forced rates for rentals to be so expensive, but the situation promises to be alleviated with the current government and private sector efforts to bridge the widening deficit.

One of the efforts to reduce Zambia’s housing shortage is the newest signing of a deal to build low cost and high cost housing units in different parts of the country.

According to Housing and Infrastructure Development Minister Ronald Chitotela, Zambia is set to tackle its housing shortage with the start of a project early 2017 to build 15,000 houses at an estimated cost of 1 billion euros ($1.04 billion).

Zambia’s state-run National Housing Authority (NHA) has signed a deal for the project with Magcor International Inc, the minister said. The deal was signed this week on Thursday, December 15, 2016 in Lusaka.

“The Magcor project is one of the many infrastructure projects due to start next year and we expect that it will ease our housing deficit,” Chitotela told Reuters.

Magcor signed a Memorandum of Understanding (MOU) and had already signed a Joint Venture Agreement with the NHA, Magcor CEO Michael Glynn said.

Glynn said his firm had guaranteed financing to build the houses in partnership with the NHA and U.S. project management and construction company Volkert Global.

He said the partnership would build the 15,000 houses over five years.

“Magcor will design, build and deliver these projects to the leasing company NHA and related public and private sectors with both equity and debt financing,” he said.

Zambia has a housing deficit affecting 1.5 million people, a third of whom are in capital cities, he said.

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18 COMMENTS

  1. 1 billion dollars for 15000 houses translates to approximately 70,000 dollars per house. So at how much will they sell these houses? This does not make sense.

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    • Clearly this either a money looting scheme or how can a low cost house cost so much. The numbers do not make any sense at all. Maybe this includes other services, such as roads, water reticulation, sewers etc. LT journalists never interrogate their sources of info.

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    • Totally agree. Does not make economic sense. the fact that the houses are many should translate to benefit of economies of scale. This is not economical at all. The ministers are just making money out of this deal, like Chishimba Kambwili was doing. Stinks of corruption and kick-backs.

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    • You 1diots should understand that apart from building a house there has to be a road network electricity lines water and sanitation social amenities parks and shops clinics police posts in those new localities. If you ‘ve planned a town or suburb just fold your cokes and apples. Your criticisms just proves how dull you are.

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    • It is not a necessary project!

      Why continue building white elephants countrywide like Kalulushi complex & opposite Heroes Stadium by Workmens’ Compensation? Individuals have built quality houses for themselves countrywide. They’re interested in building houses of their own preferred designs.

      All GRZ needs 2do is improve economy & avail land 2citizens everything else will fall into place. Why build houses that u can’t sell or rent like in Kalulushi & opp Heroes Stadium?

      I just built an electrified 4bed-roomed, IBR roofed & wallfenced house + driveway @K350,000/$35,000 incl service charges & pilferage by bricklayers. Even if I use roof & wall tiles it can’t cost me $70,000, Max wud be K500,000/$50,000! Its overhead costs incurred by & abnormal profit margins for…

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    • Even if I use roof & wall tiles it can’t cost me $70,000, Maximum wud be K500,000/$50,000! Its the overhead costs incurred by & abnormal profit margins for contractors that increase cost of building which prospective buyers wud want to avoid paying for.

      In fact utilizing proper linear programming & vectors to minimize transport costs this figure can drop further!

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    • In fact utilizing proper linear programming & vectors to minimize transport costs this figure can drop further! I mean buy materials in bulk if u can afford & if its secure to store them: i.e. buy in bulk
      – cement & other materials from nearest source & use one big truck
      – sand, blocks & aggregates & use shortest route.

      This helps 2avoid transport costs of making unnecessary trips 2buy the same item & eliminates the cost of inflation. Off course it ties capital in stocks but every builder must always incur this cost cos once materials are bought & used they can never be resold!

      All these materials do not easily rot, even cement can be stored upto 6months!

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    • The problem with buying houses built by contractors is that u for unnecessary overhead costs that are infused in the price quote. These costs include:
      – Per Diem for contractors
      – Accommodation for contractors
      -Transport costs (fuel & air tickets for foreign contractors)
      – Abnormal profit margins for contractors

      So if u stay within why pay for such costs when u stay and feed from your own home?

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    • I can’t believe the ignorance of these postings.
      $70,000 per unit for complete development is a Bargain. Think about it, municipal services, clean water, grading, utilities, not to mention the community planning, etc. In Canada, the cost to service a lot is 70K, never mind building a home – and we have world class infrastructure. I would be surprised if Magcor could even do it at this price.
      And to the goofball wo says he can build a home for half the price – ya – as a one off maybe, utilising slave labor and hand cured bricks – this methodology would take centuries – and keep the good people of Zambia in a state of hopelessness.
      I don’t understand why a select few of individuals always resist Companies who are willing to develop in Africa – sadly a lot of the naysayers are…

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    • CONTINUED
      I don’t understand why a select few of individuals always resist Companies who are willing to develop in Africa – sadly a lot of the naysayers are decedents of Expats who have deforested the continent and literally raped the people. And now they are doing it again by the pen. How can WE be so blind to these genocidal maniacs who whish to keep our brothers in Africa suppressed?
      We should be rolling out the red carpet to companies like Magcor – very suspicious…

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    • @Leslie Wardman

      You’re the real goofball! We’re talking from Zambian experience you’re waffling from Canadian perspective. Zambia & Canada are totally different economies!

      Argument is Kalulushi & Workmen’s housing projects are white elephants cos most Zambians have opted 2build own quality houses at comparably low cost. Tell me why hasn’t Napsa sold off their Kalulushi Housing stocks completed 5 years?

      Magcor builds a house @$70,000 what is selling price? Possibly $100,000 = K1million, same price as Kalulushi Houses that have remained unsold for 5 years.

      What business sense does it make to u bwana educated man?

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    • @Leslie Wardman

      You’re the real goofball! We’re talking from Zambian experience you’re waffling from Canadian perspective. Zambia & Canada are totally different economies!

      Argument is Kalulushi & Workmen’s housing projects are white elephants cos most Zambians have opted 2build own quality houses at comparably low cost. Tell me why hasn’t Napsa sold off their Kalulushi Housing stocks completed 5 years?

      Magcor builds a house @$70,000 what is selling price? Possibly $100,000 = K1million, same price as Kalulushi Houses that have remained unsold for 5 years.

      What business sense does it make to u bwana educated man?

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  2. You will always say that with out even switching on your head. The average figure of K700,000 is even too low if you think about the high cost houses. This amount includes the land and compensation expenses for the land. Please switch on your grey matter iwe.

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  3. The parties involved in this deal should just cancel the deal , it is way too expensive considering the fact that almost all building material is locally available. pegging the kwacha at 9 against the dollar that goes to about 600,000 kwacha per house. No, its illogical . We are a poor nation , very backward in all areas of development, our focus should be on hard work not buying goods and services at uncorroborated prices. A decent low cost house in zambia can be build at K300,000.

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  4. Those who have built housing in green fields please us understand the Total Capital Outlay involved in building these houses. People will just calculate figures without knowing the components of this total cost. Land acquisition title deeds compensation survey water and sanitation roads might be some of the components of this total cost. I am just thinking

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  5. Sounds a gud deal.

    Except for our corrupt leaders who may want to bulldoze project to appease cadres.

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  6. Listening from some of the comments one wonders if our criticism is because of the program being implemented under the PF govt and reign. We may be forgetting that these houses will come with social amenities and related infrastructures such as roads, electricity, shops etc and are being implemented on behalf of the citizens who gave the Authority to NHA by act of parliament way before the PF came. Am a die HH SUPPORTER but where credit is due am sure its worthy giving it. Some of these discussions for financing huge projects of this nature began in Chiluba or Mwanawasa’ time. One should be informed that these houses will be build in a period of years and in phases and repayment of these loans will be long term as its purely a PPP projects with very good terms that Zambia has not…

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