Rwanda's mortgage sector on pathway to growth

Rwanda's real estate sector is experiencing significant growth in mortgage investments, driven by substantial government investment to address the country's large infrastructure gap. Christian Abijuru, Head of Business Banking at I&M Bank Rwanda, shared insights on the market's trajectory and the opportunities available for investors. Abijuru attributed the sector's development to Rwanda's robust infrastructure, including standardized land practices, efficient mortgage registration processes, and clear land titles. These factors have enhanced the sector's attractiveness for investors. The market's product offerings cater to various needs, starting from land acquisition to property development and off-taker financing. Notably, I&M Bank Rwanda provides mortgage options with flexible terms, including repayment periods of up to 25 years, making housing more accessible for individuals and businesses alike. Abijuru highlighted the bank's focus on leading in mortgage financing, emphasizing their commitment to developing tailored products to meet market demands. While acknowledging challenges in the sector's overall non-performing loans due to large-scale real estate projects, he pointed out the lower default rates at individual and SME levels. Abijuru discussed risk mitigation strategies, such as stringent project evaluation criteria and diversifying funding sources across multiple off-takers to reduce financial exposure. Furthermore, the bank introduced innovative solutions like equity release facilities and rental income-based financing to unlock capital from existing properties. In response to evolving market dynamics, I&M Bank Rwanda continues to innovate its mortgage offerings to align with customer needs and market trends. By addressing operational risks through comprehensive project assessments and strategic partnerships, the bank ensures prudent financing practices. The real estate financing landscape in Rwanda is characterized by promising opportunities, with government-led initiatives to enhance affordable housing access and support sector growth. I&M Bank Rwanda's substantial mortgage portfolio, representing over 40% of its retail market, underscores its strong presence in driving real estate development and fostering financial inclusion. As Rwanda's real estate sector thrives on the back of increased mortgage investments and strategic partnerships, investors stand to benefit from a growing market with diverse opportunities and innovative financing solutions.