Ethiopia Real Estate Analytics

Property market metrics including price-to-income ratio, rental yields, and price trends

Price to Income

43.1x

Ratio of property prices to annual income

Rental Yield

6.8%

Average annual rental return

Price to Rent

14.6

Ratio of property prices to annual rent

Price to Income Ratio

Ratio of median house price to median annual household income

Rental Yield

Annual rental income as percentage of property value

Price to Rent Ratio

Ratio of property price to annual rental income

Apartment Rent (City Centre)

Monthly rent for 1-bedroom apartment in city centre

Apartment Price (City Centre)

Price per square meter to buy apartment in city centre

Apartment Price (Outside Centre)

Price per square meter to buy apartment outside city centre

1BR Rent (Outside Centre)

Monthly rent for 1-bedroom apartment outside city centre

3BR Rent (City Centre)

Monthly rent for 3-bedroom apartment in city centre

3BR Rent (Outside Centre)

Monthly rent for 3-bedroom apartment outside city centre

Mortgage Interest Rate (20Y)

Average mortgage interest rate for 20-year fixed loan

Additional Insights

Expert analysis of Ethiopia Real Estate trends and investment implications

Market Overview

Ethiopia's property market is characterized by high price-to-income ratios, suggesting affordability challenges, yet offers relatively attractive rental yields at 6.8%. Historical data indicates moderate price growth, but the high price-to-rent ratio of 14.6 suggests renting might be more economical than buying. Investors should consider market maturity and potential risks of correction.

Key Findings

Data-driven insights

•The price-to-income ratio is 43.1, indicating significant affordability challenges for local buyers.
•Rental yields stand at 6.8%, which can be attractive compared to local interest rates.
•The price-to-rent ratio at 14.6 suggests renting is more cost-effective than buying.
•Historical appreciation shows moderate growth, but current metrics suggest possible market correction.

Market Trends

Historical patterns

•Long-term trend of increasing price-to-income ratios, indicating a market becoming less affordable.
•Stable rental yields over the decades, maintaining investor interest.
•Cycles of moderate price appreciation followed by periods of stagnation or correction.

For Investors

Actionable takeaways

•Consider rental properties as they offer attractive yields compared to local financial products.
•Monitor the market for signs of correction due to the high price-to-income ratio.
•Evaluate buy vs. rent scenarios carefully as current data suggests renting might offer better value.
•Focus on yield optimization and risk management given the potential for market adjustment.

Market Context

Ethiopia's property market is still developing, with significant urban expansion and infrastructure investment opportunities. However, potential investors must navigate affordability issues and be aware of the risks of a market correction due to current valuation levels.

💡 Insights based on historical data. Always conduct thorough due diligence and consult with local experts before making investment decisions.