Namibia’s household financing conditions remained tight in November 2025, with credit demand continuing to favour essential and asset-backed borrowing, while mortgage and unsecured lending lagged, according to Simonis Storm.
The firm said that despite supportive monetary conditions and a stabilising liquidity environment, affordability pressures and weak income growth continued to limit household borrowing.
As a result, household credit demand remained concentrated in essential and asset-linked categories rather than broad-based consumption or housing finance. Borrowing patterns point to continued caution among households despite lower lending rates, said Simonis Storm economist Almandro Jansen.
Household mortgage lending remained under pressure, with growth weakening further to 0.0% year-on-year. Subdued demand for home loans reflected high construction costs, rising utility charges and the limited availability of affordable housing stock.
Jansen said mortgage activity remained largely confined to higher-income borrowers, while affordability constraints continued to exclude much of the lower- and middle-income segment from the property market.
“Mortgage demand remains muted, reflecting both affordability constraints and structural supply limitations in the housing market,” he said.
Overall household credit growth softened further to 2.5% year-on-year in November, down from 2.8% in October, reinforcing the view that the household recovery remains slow, uneven and highly selective.
The household debt stock remained above N$70 billion, with borrowing behaviour constrained by modest wage growth, elevated living costs and persistent affordability pressures.
“Despite a sizeable household debt stock, borrowing appetite remains cautious as real income growth continues to lag rising living costs,” Jansen said.
In contrast, instalment and leasing credit remained the strongest-performing household-linked category, with growth accelerating to 15.8% year-on-year in November from 14.8% in October. This was supported by strong vehicle financing activity and improved availability of imported models.
However, Simonis Storm noted that an increasing share of this momentum originated from corporate rather than household borrowers, suggesting that household participation, while resilient, remained secondary to business-driven demand.
“Households are prioritising vehicle and equipment purchases over property investment due to lower upfront costs and the greater flexibility of instalment-based lending,” Jansen said.
Overdraft lending to households remained in contraction for the eleventh consecutive month, declining to minus 12.6% from minus 10.4% in October, as elevated food, transport and utility costs continued to erode disposable incomes.
Other loans and advances recorded slower growth of 7.2% year-on-year, down from 8.2% in October, consistent with more selective uptake of unsecured credit focused on short-term consumption smoothing, education and healthcare-related expenses.
“Overall risk aversion among households remains elevated, with unsecured borrowing still subdued amid sustained financial strain,” Jansen said.
Total private sector credit exceeded N$123.1 billion in November, with households accounting for 57%, corporates 41.7% and non-residents 1.3%. Private sector credit growth eased to 4.5% year-on-year from 4.7% in October, confirming a gradual moderation towards year-end.
“The moderation in private sector credit reflects cautious household borrowing, corporate repayments and residual Eurobond-related liquidity effects rather than a deterioration in financial conditions,” Jansen said.
Corporate credit growth slowed to 7.2% year-on-year in November from 7.5% in October, driven mainly by net repayments in mining, telecommunications, and wholesale and retail trade, particularly within overdraft facilities and other loans and advances.
Despite the slowdown, the outstanding stock of corporate credit remained above N$50 billion, signalling a still supportive financing environment despite temporary liquidity adjustments linked to the Eurobond redemption.
“Corporate borrowing behaviour continues to signal a measured but expansionary investment cycle, supported by easing monetary policy, stabilising inflation and improving medium-term business sentiment,” Jansen said.
