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Our Top 5 African Countries for Investment

February 12, 2018Article by Paul Avery

The blanket condemnation of ‘sh**hole African countries’ in President Trump’s recent comments is, from an investment perspective, extremely easy to refute. The continent as a whole is set to double in population to 2.5bn people by 2050 according to UN estimates, making Africa both the fastest growing market for commerce in the world, but also potentially the most fertile terrain for development, innovation, and social change.

Emerging markets indices far outperformed those of US stocks last year, with gross returns of 20% compared with 12% (Economist). The financial case is blindingly apparent, but the more urgent question is whether less economically developed nations are worth investing in despite their relative poverty, or precisely because they are cheap.

In our analysis of Africa as a destination for investment in real estate, we found that the most attractive target countries were those where baseline levels of political stability, competent economic management, and robust legal frameworks were already in place. In other words, Africa is exciting right now not because it contains the poorest countries offering the greatest potential rewards but because many of its states are already well-advanced on the development path – and therefore deserving of the foreign direct investment that can help to lock in their healthy trajectories.

The property markets we would recommend in Africa are not necessarily the most affordable ones, but rather the ones underpinned by a robust (or improving) system of land rights, urbanisation in pursuit of economic opportunity, a growing middle class, and an undersupply of decent accommodation. Ghana, Ivory Coast, Tanzania, Kenya, and Ethiopia are all places displaying very promising fundamentals (see notes at the bottom). But that doesn’t mean more ambitious investors should dismiss more troubled states out of hand.

Although currency woes and the decline in the price of oil have made Nigeria a less appealing target of late, its housing shortage is reported to increase by 700,000 units every year (Construction Review), so those with a greater risk appetite could do very well over the long term. The best and most topical example of a borderline case is Zimbabwe. Corruption has been so rampant that international investors have rightly steered clear for some time, but improving property rights has been a central issue in the recent handover of power and (though it is early days) serious effort on that front could unlock immense potential that would be worthy of investor attention.

In terms of how to go about investing in such places it can be wise to dip in one’s toe with a reputable fund based in your home country. For property, going it alone can be very risky unless you know the target country well or are highly experienced. However, plenty of companies (like ours) undertake the search for a reputable developer and conduct intensive due diligence on a variety of opportunities. That doesn’t mean it is fool-proof. But Africa, as well as other places recently insulted in the Oval Office, offer the benefit of low entry points – meaning you can begin with a relatively small capital outlay to test out the market. But the way things are going they won’t remain that cheap forever.

Here are a few countries we find particularly interesting right now:


Thanks to a recent oil discovery and large quantities of gold and cocoa exports, Ghana has managed to retain its diversified (if slightly slower) economy. Seen as Africa’s poster child for a stable democracy, this nation has well established institutions. Foreigners can own land in Ghana, and prices have soared in the capital, Accra. However, the property market suffers from oversupply and prices have begun to soften.


This progressive African nation is a leader in business and technology. Although it’s facing current challenges with rising crime, its property market remains buoyant and there is a supply shortage.  Foreigners can own property in Kenya but it is dominated by private equity. The government has also introduced tax incentives for property developers.

Côte d’Ivoire

Having the 3rd highest economy growth rate in the world (World Bank), income levels are high in Côte d’Ivoire and the business climate is open and efficient, attracting more FDI projects. An increase in housing stock has been boosted by infrastructure but foreign investment is not yet well established.


The world’s eighth fastest growing economy and home to Africa’s fastest growing city, Dar Es Salaam, Tanzania has enjoyed long standing political stability. Although foreigners can struggle to own land outside of special economic zones, there is still opportunity due to the undersupply of housing, with 3 million units needed. There is also strong capital growth, estimated at 10-15% p.a.


As Africa’s oldest independent nation, Ethiopia is growing swiftly and sustainably. Although transaction volumes in property market are high, land rights remain restrictive. The country is also seeing a steady increase in higher end property supply.

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Paul Avery

Paul joined us in 2016 to lead our in-house research efforts, producing reports and guidance for clients as well as the strategic market analysis behind our new project launches. His background is in sustainability in the construction sector, and he is currently being trained in property valuation to further bulk up his investment creds.
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