The average price of land in a middle income suburb of Windhoek such as Khomasdal is 12 times more than the in Keetmanshoop.
This is according to the newly released First Capital Report on House Building cost March 2019. The report states that Land prices remain persistently high, which is a limiting factor to acquiring residential properties especially in Windhoek and coastal parts of the country.
Amongst the towns presented, the cost of serviced land for an erven measuring 375 square meters is cheapest in Nkurenkuru costing N$5,063 followed by Helao Nafidi costing N$5,378.
The same size of land would cost N$208,166 in a middle-class location of Khomasdal in Windhoek making it the most expensive, followed by Henties Bay and Walvis Bay with N$91,875 and N$62,250 respectively.
Clarinda Kavezuva Research Analyst at first Capital stated that the downward revision of government budget for land servicing in 2019/20 from N$850,2 million to N$697,8 million indicates that land servicing within local authorities could scale down.
She stated that Less subsidy in the wake of high demand for urban serviced land would mean less subsidy for land servicing, further worsening high urban land prices.
Kavezuva also stressed that other than the mismatch between demand and supply of land, inefficiencies in servicing of land as well as speculative motives among private developers equally contributes to high urban land prices.
First capital noted Building material prices are expected to remain stable in the throughout 2019.
“Given the dismal economic outlook, demand for cement is expected to remain weak implying that the increased competition between two domestic producers (Ohorongo and Whale Rock) will be on reducing prices. This has already materialized given the realized 10% decline of cement prices in March 2019 (y/y).” Kavezuva stated.