The Institute for Public Policy Research (IPPR) has called for a swift implementation of the Rent Control Bill to address the rising rental costs and protect tenants from exploitation.
IPPR Research Associate, Kitty McGirr, said the government should accelerate the implementation of flexible land tenure to provide affordable housing options for its citizens, particularly those with low incomes, and to stimulate economic growth and development in the housing sector.
This comes as Namibia is facing a growing housing crisis that is leaving many citizens struggling to find affordable accommodation, with rental costs soaring and the dream of homeownership remaining out of reach for a significant portion of the population.
McGirr highlighted the urgency of the situation in a report titled “The Global Cost of Living Crisis from a Namibian Perspective”.
McGirr explained that the high costs of rental units in Namibia have created a growing disparity with average real wages, which have struggled to keep pace with the rising inflation.
She noted that FNB’s Residential Rental Index, for example, recorded a 12-month rental index growth of 0.6% at the end of March 2022, the highest rate since the early stages of the pandemic in May 2020.
The average rent for three-bedroom units also reached a record high of N$19,329 at the same time.
“This surge in rental costs has led to Namibia’s rent-to-income ratio reaching 39%, dangerously close to the affordability ceiling of 40%. These developments underscore the need for the government to take swift action by enacting a Rent Control Bill to implement rental control measures and activate the Rent Control Board,” she said.
McGirr also stressed that rent controls would offer crucial protections to tenants, shielding them from economic exploitation by landlords who often take advantage of the severe shortage of affordable rental properties.
However, despite provisions for the Bill to be tabled in Parliament by the end of 2021, McGirr noted that “its status remains pending in 2023.”
The Rent Control Board, now under the Ministry of Urban and Rural Development, also remains inactive, exacerbating the rental crisis.
The Flexible Land Tenure Act passed in 2012, allows for the establishment of community land trusts, holding plots in trust for the benefit of the community with various tenure options, including short-term leases and certificates of acknowledgment of land occupation rights that can be converted into title deeds.
McGirr emphasised that flexible land tenure can open doors to creditworthiness for its recipients, as land titles can be used as collateral for future loans to fund formal housing construction to replace informal dwellings.
However, despite its potential benefits, McGirr noted, “the implementation of flexible land tenure has been slow, with the central government citing reluctance from some local authorities to make land available, while local authorities point to inadequate subsidies from central government to support land delivery.”
Other policy recommendations from the report include improving the efficiency and productivity of government expenditure, promoting agriculture as a labour-intensive industry for development, and filling the gaps in social protection coverage to mitigate rising living costs for citizens.
PSG forecasts 2.2% GDP growth in 2024 and anticipa
