Old Mutual seeds N$50m into housing project

Old Mutual Namibia last week launched its Affordable Housing Fund with a seed capital of N$50 million to address the country’s housing shortage.

Namibia has been facing soaring property prices, leading to many unable to afford a home.

According to a statement issued by the company, the fund will provide financing for affordable housing projects by focusing on land servicing and top structure development.

“This is aimed at addressing the growing demand for accessible and affordable housing in the country,” says Old Mutual Namibia spokesperson Hileni Amadhila.

According to her, the new fund builds upon the foundation laid by the Midina Fund established in 2004.

“The new fund has been created in response to regulatory changes and the increasing need for targeted investment in the affordable housing sector,” says Amadhila.

She says the fund will focus on previously marginalised communities to promote inclusive development.

“It will improve property sector efficiency, particularly in rural areas, by investing in balanced mix of equity, debt, quasi-equity and structured equity across both greenfield and brownfield opportunities,” says Amadhila.

She says the fund aims to generate a return that is 4% higher than the Namibia Consumer Price Index over rolling 3-year periods.

Investors can expect to receive income payments twice a year.

Old Mutual Investment Group managing director Lionel Kannemeyer says the broader mission of the fund is to change the housing landscape in the country.

“The Old Mutual Namibia Housing Fund is not just an investment vehicle, it is a catalyst for change. We are driven by a clear objective to deliver sustainable returns while addressing the critical housing needs of our nation,” says Kannemeyer.

He says this is an investment in the future of Namibia.

The fund was endorsed by the minister of Urban and Rural Development, Erastus Uutoni.

“As a ministry, we are proud to associate with and feel fortunate to have Old Mutual as part of this transformative journey. Your investment in affordable housing is not merely a financial decision; it is a commitment to a more robust economy. Together, we can make a lasting impact and pave the way for a brighter future for all,” says Uutoni.

Giving his address during the launch, High Economic Intelligence managing director Salomo Hei said high household indebtedness poses a significant challenge to affordability, while limited land availability constrains new development.

He added that economic uncertainty, elevated unemployment rates and fluctuating interest rates contribute to an uncertain market environment.

“Rising inflation and increasing building costs further aggravate these issues,” said Hei.

However, he said strategic policy measures and innovative solutions can mitigate these risks and pave the way for a more stable and accessible housing market.