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Real Estate in Africa

Note: This report is an extract from the book "Grow Rich in the New Africa".

Table of content: Part 1: Real Estate as an Asset Class Part 5: New City Developments
  Part 2: The Investment Case for Real Estate Part 6: Yield of Real Estate Investments
  Part 3: Commercial Property Part 7: Legal Ownership of Real Estate
  Part 4: Residential Property Part 8: Conclusion

Ownership of Real Estate

Countries with liberalized property markets are the most attractive to foreign investors. They have a long tradition of private property ownership. The legal framework is quite sophisticated offering high investment security, compared with other African countries.

The following sections show how foreigners can acquire real estate in Africa. Restrictions apply in some countries, depending on the type of land.

Countries with liberalized property markets

There are only five countries out of 54 that have liberalized property markets. The following table describes them.

South Africa South Africa has one of the world’s most accessible property markets. Foreigners may acquire and own property, including agricultural land.
Botswana Freehold land ownership is available and encouraged for foreigners.
Namibia Foreigners may acquire and own property in Namibia, except agricultural land. Land is typically held in freehold title. There is an adequate land registration system in Namibia.
Morocco The property market in Morocco is quite active and foreigners may acquire and own it. Morocco follows French law with reference to title and title deeds. Title insurance is available.
Egypt Foreigners may own property. International title insurance is available. There are adequate controls over land records to create a comfort level with ownership. 99% of the real estate in Egypt can be owned by freehold title. Real estate in the South Sinai and Sharm El Sheikh can only be acquired via a 99-year lease.

Countries with the most restricted property markets

Countries that had, or still have, systems based on socialism generally do not allow private ownership of land. Land usually belongs to the state, or the government, and will be available for usage only on long-term leases. Registration processes are often complicated and ownership rights are not well protected. The following table highlights countries in this category.

Angola All land belongs to the state and may only be used by permit on long-term leases.
Mozambique The government owns all land in Mozambique. Land is controlled by 99-year leases. Foreigners may obtain control and use of land through these long-term leases.
Democratic Republic of Congo
All property belongs to the State, but this is controverted by individuals, tribal communities, and local cities and governments. As there is no effective system for land ownership and transfer in place, issues around ownership are very complicated.
Ethiopia Foreigners may not own freehold land in Ethiopia. Ethiopian citizens may own land in freehold. However, most of the land is only available on leases. The land registration system is not well developed and can be very tricky.
Nigeria All property belongs to the State. Foreigners cannot acquire or own real estate in Nigeria. Properties can be leased for terms of 99 years.
Tanzania The Government owns all the land in Tanzania. Foreigners can acquire an interest in Improved Property with a lease with terms of between 33 and 99 years. Properties in and around Zanzibar typically have shorter term leases, and there are no automatic renewals.
Zambia Foreigners may not acquire or own land in Zambia. However, there are a few exceptions.

Countries with free property market

In some countries, there are certain restrictions that may depend on the type of land (i.e. freehold land, tribal land, community land, urban land) or its classification, respectively. With agricultural land in some countries, there may be political and social issues around land ownership, which might even prevent land from being properly developed, as is the case in most parts of Zimbabwe. The following table highlights countries in this category.

Ghana Foreigners may acquire and own property, depending on the type of land. The 'main land' category can be accessed easily. Land owned by the Government can also be acquired upon application and approval.
Cameroon The right of ownership of real estate is granted by the Constitution. No reference is made to a citizenship requirement. Cameroon’s laws are affected by the differences between British and French laws. Cameroon still lacks reliable national cadastral land register.
Kenya Foreigners may own property which is classified as commercial or residential. Land can by "used" via a 99-year lease. Neither foreign individuals nor foreign controlled corporations can own agricultural land.
Rwanda Foreigners must make Bank Deposits of 500,000 U.S. dollars for a period of six months. Foreigners may acquire and own real estate above the ground. They may not acquire any interest in the land which is owned and controlled by the government. Land leases can be obtained for periods of between 50 and 99 years.
Mauritius Foreigners may purchase real estate in Special Approved Projects and also receive a residency permit, at a minimum price of 500,000 U.S. dollars.

> Continue to part 8