Property prices have risen in some African cities in recent years, altering the urban landscape and providing issues for people and governments alike.
While growing property values may indicate economic growth and development, the effects of high property prices in African cities are complex and extend beyond the real estate sector.
As a result, while investing in real estate, it is critical to understand the property price index in relation to the location.
The Property Price Index (PPI) is an important economic indicator that represents the long-term trend in real estate values in a certain region.
PPI is widely monitored by investors, governments, and individuals alike since it gives significant insights about the health and stability of the real estate market.
Numbeo, a platform that normally details contrasts in living standards around the world, regularly tracks property prices in a variety of locations, including Africa.
The platform indexes alter on a regular basis, as evidenced by the difference between the September property price index, which ranks Douala as the most costly city for real estate, and the list below, which ranks Kampala as the most expensive city for real estate in November.
With that said, the top ten African cities with the most expensive real estate now, as measured by a price-to-income ratio, are listed below.
The values in the table represent Numbeo’s price-to-income ratio. The price-to-income ratio is a key indicator of apartment affordability, with a lower ratio indicating better affordability. It is commonly calculated as the ratio of median apartment prices to median familial disposable income expressed in years of income (however other formulas are used).
Numbeo’s formula assumes and employs: net disposable family income, defined as 1.5 times the average net pay (the accepted share of women in the workforce is 50%). The average price per square meter (the formula used) is the average price per square meter in the city center and outside of the city center.
| Rank | City | Country | Price-to-income ratio | Global rank |
|---|---|---|---|---|
| 1. | Kampala | Uganda | 79.4 | 1st |
| 2. | Douala | Cameroon | 47.1 | 3rd |
| 3. | Addis Ababa | Ethiopia | 40.2 | 5th |
| 4. | Algiers | Algeria | 25.9 | 27th |
| 5. | Oran | Algeria | 19.9 | 40th |
| 6. | Rabat | Morocco | 19.6 | 44th |
| 7. | Alexandria | Egypt | 17.1 | 63rd |
| 8. | Tunis | Tunisia | 15.0 | 94th |
| 9. | Casablanca | Morocco | 14.9 | 97th |
| 10. | Marrakech | Morocco | 13.7 | 127th |