Quarter 3 of 2025 marked a pivotal moment for Namibia’s property market. After two quarters of policy reform and economic stabilization, tangible impacts emerged: borrowing costs eased, housing finance options expanded, and infrastructure repairs accelerated. Yet affordability constraints, slow wage growth and regional pressures continue to shape market performance.

Interest rates: Gradual easing and positive outlook

The Bank of Namibia (BoN) maintained the repo rate at 6.75% during 2025 to safeguard currency stability but introduced a directive requiring banks to narrow the gap between repo and lending rates by 25 basis points in two phases by December 2025.

The first adjustment in September lowered the prime rate to 10.375%.While banks faced slight margin pressure, consumers benefited from improved cash flow, lower instalments and a more responsive credit environment.

The Bank of Namibia has kept the repo rate unchanged at 6.50% to safeguard the Namibia-South Africa currency peg and because inflation remains contained while economic growth has slowed. The central bank said the current stance supports price stability and domestic economic conditions despite weaker momentum.

Pension-Backed Home Loan Scheme: A game changer

The Government Institutions Pension Fund (GIPF) signed a Memorandum of Agreement in September 2025 to pave the way for the Pension-Backed Home Loan Scheme (PBHLS), enabling members to borrow up to one-third of their pension savings to buy, build, or improve homes. Administered by Kuleni Financial Services and First Capital, the scheme reinvests repayments and interest (repo + 2.5%) into members’ pension accounts.

Qualifying members could begin borrowing on 12 January. Other pension funds are preparing similar offerings, signalling a shift toward pension-backed housing finance as a mainstream solution – particularly for households excluded from traditional mortgages.

Infrastructure: Strain and reconstruction

Windhoek faces a N$2.67 billion road maintenance backlog, worsened by years of underfunding and recent floods. Despite repairing over 26,000 potholes since February 2025, current allocations remain far below the N$384 million required annually to stabilize the network.

National roads challenges

Yet progress continues. The completion of the N$3 billion Dr. Hage G. Geingob Interchange marks one of Namibia’s largest mobility upgrades, improving traffic near Hosea Kutako International Airport and supporting long-term urban expansion.

Construction and housing delivery: Activity softens, foundations strengthen

Windhoek approved N$181 million in building plans in September, a decline month-on-month and year-on-year reflecting slower residential and commercial activity. However, on a 12-month basis, approvals rose 3.7%, driven by steady commercial submissions.

The National Housing Enterprise (NHE) continues to advance its mandate, securing 2,500 plots under the Informal Settlement Upgrading Project and planning to deliver 2,000 new low-income units by April 2026. Affordable repayment models starting from N$400 per month support uptake among low-income earners.

Market outlook