Addis Abeba Housing Agency Targets Six Billion Birr Collection

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The Addis Abeba Housing Agency plans to collect six billion Birr during the 2013/14 fiscal year. This will be done through the 20/80 and 10/90 housing schemes. Nearly a third of this money will be used to settle loans from the Commercial Bank of Ethiopia.

The projected amount is double the three billion Birr the Agency aimed to collect in 2011/12, out of which 1.2 billion Birr.

The Agency, which has collected a total of five billion Birr since the start of the scheme in 2005, has built and transferred only 100,000 housing units over the last eight years. It aims, however, to transfer 40,000 units in the current fiscal year, from which it plans to collect 20pc and 10pc of the down payments, from the 20/80 and 10/90 housing schemes, respectively. This is expected to net the Agency a total of between 1.5 billion and two billion Birr.

It has already used the five billion Birr to settle part of the 16 billion Br borrowed from the CBE. This fiscal year, it plans to use 2.2 billion Br for debt settlement.

Additional contributions will come from the down payments owed by the home-seekers who received 28,000 houses under the 20/80 scheme, in 2012. The remainder is expected from the monthly payments of the transferred condos, as well as other financial sources, according to Mesfin Mengiste, head of the Addis Abeba Housing Administration & Development Agency.

The Agency plans to transfer 26,000 houses under the 20/80 and 14,000 houses, for the first time, under the 10/90 scheme, in 2013/14. Close to 3,000 of these units will be stores for rent.

Mesfin dismissed doubts regarding the Agency’s ability to deliver such a large number of units within just one year.

“After eight years, we now have enough experience to deliver the 40,000 houses faster than before. Some of them are nearing completion,” he claimed.

Nonetheless, at discussions Mesfin held with Getachew Hailemariam, head of the Addis Abeba Construction & Housing Development Bureau, and heads of branches of the Agency in the 10 districts of the city, the district heads complained about a lack of skilled workers at the district level.

Moreover, the exact number of unoccupied condos is unknown to officials, as well as the number of residents holding both condos and Kebele houses. Both of these figures could well affect the target.

District heads from Bole, Yeka and Kirkos even claimed that they only have two to four workers to deal with condos, instead of the 15 workers required in each district. They proposed that a separate office be established to control the delivered condos, but Mesfin and Getachew rejected the idea. They also asked that a better line of communication to be established between the Addis Abeba Land Administration, the CBE and the Agency.

The Agency estimates that 30pc of the home-seekers picked through the raffle will not show up to collect their new homes. Close to 5,000 condo units are currently vacant. In addition, 40pc of residents that obtained condos are thought to live in Kebele houses. The Agency plans to check the occupancy of the condos and Kebele houses in the city in current fiscal year, after September 2013.

The construction has now been 40pc to 90pc completed, according to Mesfin. These construction sites, located in the Yeka Abado, Bole Arabsa, Koyefeche and Kilinto areas, combine both schemes on the same sites.

A total of 860,000 home-seekers were registered for the two schemes from June 10 to 28, 2013.

BY ASHENAFE ENDALE
SPECIAL TO FORTUNE

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