Approved housingplans shoot up 152%

The construction industry has been in the doldrums over the years, with little activity in the sector and few affordable houses being constructed, but a recent cash injection could kick-start the sector.

Minister of finance and public enterprises Iipumbu Shiimi during the recent national budget allocated N$700 million to the upgrading of informal settlements, extensive land servicing, and other programmes to enhance access to housing opportunities nationwide.

It remains to be seen whether this would have a ripple effect on the sector, although the City of Windhoek already approved 192 building plans in February.

“This is a significant increase from 76 building plans approved in January 2024, and translates to a growth rate of 152,6% month on month, and 8,5% year on year, compared to February 2023,” economic researcher Halleluya Ndimulunde of Simonis Storm Securities says.

The total value of these approvals reached N$190,7 million in February this year, substantially higher than the N$53,8 million recorded in January.

Ndimulunde says 123 of the plans approved in February were for additions, 36 for new residential houses, 24 for wall constructions, and five for commercial developments.

The City of Windhoek received 186 building plans in February, representing an uptick from the 122 plans submitted in January, but a decline from the 202 plans submitted in the same month last year.

Some 31 buildings were completed in February, with a combined value of N$22,9 million.

“The bulk of these completed projects are at Otjomuise and Wanaheda. Among these completed projects, most were residential houses, followed by additions to existing structures,” the researcher says.

Meanwhile, the Swakopmund municipality received building plans estimated at a total value of N$42 9 billion between 15 January and 14 February.

Additionally, the municipality disclosed that during this period, it received N$578 149 in building application fees, N$5 011 in building compliance fees, and N$57 744 in building fines issued.

The municipality approved 50 building plans in February, with a total value of N$125,3 million.

“Among these approvals, 40 were for new residential buildings, six for institutions, two for industrial buildings, and two for commercial buildings,” Ndimulunde says.

She says the municipality recorded a huge increase of 28 projects completed in February, compared to only six in January.
The total value of these completed projects amounted to N$27,1 million.

Simonis says actions that boost infrastructure development, promote affordable housing projects, and encourage sustainable building practices are vital for the industry’s long-term health.

Ndimulunde says during the recent tabling of the national budget, Shiimi also announced that adjustments will be made to transfer duties and stamp duty brackets in line with inflation in a move to enhance access to housing.

Consequently, the exemption level will be raised from N$600 000 to N$1,1 million.

Additionally, the threshold to trigger the 8% transfer duty rate will be increased to N$3,15 million, effective from the 2024/25 financial year.

“With these measures in place, it is anticipated there will be a resurgence in local construction activity and an increase in building plan engagements in 2024,” Ndimulunde says.

– email: matthew@namibian.com.na