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African real estate. Stephen Brown
1. Introduction
Urbanization is a development phenomenon that comes about with the development of a country's economy in general and industrialization in particular. It follows that the rate of urbanization is considered to be one of the indicators of a country's economic development. The rate of urbanization is directly related to the demand for houses. It is expected that as a country becomes more urban, more houses will be needed to accommodate the increasing population in urban centers. The practice, however, does not support this in that the acceleration in urbanization is not accompanied by the provision of adequate housing. This is one of the reasons for the development of informal settlements, which provide housing to most low-income groups ([15] UN-HABITAT, 2002). In Kenya, for instance, it was reported that rapid urbanization is placing an enormous strain on an already stretched urban infrastructure, housing stock and services, and resulting in the proliferation of informal housing settlements (www.citiesalliance.org).
Various factors have been pointed out in relation to this divergence between the inadequate availability of housing on the one hand and the rapid urbanization on the other. In addition to the low level of economic development, the lack of genuine political will to address the issue in a fundamentally structured, sustainable and large-scale manner is commonly cited ([15] UN-HABITAT, 2002). Other factors can also be made in relation to this. The absence of urban policy (including housing policy), which is crucial for successfully narrowing the gap between urbanization and housing development, is an important factor.
After the literature review on the theoretical and practical approaches in addressing housing problems in section two, the situation of housing development in Ethiopia in general is discussed in section three. Section four focuses on the discussion on assessment of the housing sector in Addis Ababa. Section five reviews the prospects in housing development in Addis Ababa. Finally, section six concludes the paper.
2. Housing finance
Housing loans are loans of a long-term nature provided for the construction of individual houses and business premises. The common practice is to provide housing loans to that section of the population that earns moderate to high incomes, provision of housing loans operates through specialized institutions (mortgage banks), and over...