Urban land markets in Southern African cities

The cities in southern Africa reflect the rapid urbanisation characteristic of sub-Saharan Africa in general. Angola, Botswana and South Africa have the highest levels of urbanisation with about 60% of their population living in cities in 2010 and this percentage is expected to rise to about 80% by 2050.

The main drivers of urban growth in the region are natural increase (population growth), peri-urban rural settlements inclusion within city boundaries and rural to urban migration, both within and between countries, although migration in southern Africa is largely circular and seasonal with people moving between their homes in rural areas and workplaces in industrial, commercial and mining towns.

The study indicates that in southern African cities, the formal sector is unable to meet the demand for urban land amongst the majority of residents – the urban poor. The bulk of the demand for land is met through the informal market, which is open to all income groups. However, neither the formal nor the informal system is working well for the poor. For example, in Maseru the commercialisation of the informal market excludes the poorest households. Understanding the factors that affect how land markets work can help us to identify interventions that may help poor people to access suitable land and adequate accommodation in cities.

Urban land markets in southern African cities are influenced by the dynamics related to two different tenure systems:

• Customary tenure of communal land that is not formally registered;

• Statutory tenure of land that is registered, with land rights being held through a freehold or a leasehold.

The study states that efficient and equitable land markets are necessary for well-functioning cities. However, examples in this case study show how, in an effort to meet the increased demand for land in peri-urban areas, government interventions and a lack of capacity to adequately administer and manage land have distorted the operation of urban land markets. This has increased the gap between rich and poor in terms of access to land. Examples further suggest that unlimited market forces also exclude the poor – in both formal and informal markets.

Recommendations for a transitional approach from informal to formal urban land markets identified in the research study include:

Create institutional structures that will facilitate the gradual transition from informal to formal markets.
 Devolve certain municipal functions to these transitional institutional structures, such as the registration of occupancy, enforcement of basic land use regulations, dispute settlement and simple title registers by local chiefs or their equivalents.
Make sure that the transitional institutional structures permit access to property development finance and are supported to initially undertake land management and planning at the sub-municipal level.
Develop land supply and administrative systems that reinforce emerging market relations whilst also ensuring that such markets work for the common good.