Buying real estate in Ethiopia?

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Buying a property in Addis Ababa: a complete guide

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property investment Addis Ababa

Yes, the analysis of Addis Ababa's property market is included in our pack

Thinking of buying a property in Addis Ababa? You're not alone!

Addis Ababa's unique blend of tradition and modernity enthralls people, making them dream of owning an elegant townhouse or a spacious condominium in Ethiopia's capital.

Still, would it be a smart investment? Are property prices increasing in Addis Ababa? How much does it cost? Is it wiser to buy property in Bole or Kazanchis? Are there any hidden fees? Where are the best rental yields?

In this article, everything is sorted out for you.

At TheAfricanvestor, we've extensively researched this market; As a matter of fact, we've gathered all our findings in a pack. Get it now.

In the lines below, we'll provide you with helpful information.

How's the property market in Addis Ababa?

Is the property market doing well or poorly? Data will provide us with answers.

Types of properties

In Addis Ababa, you can find various types of properties for sale, including apartments, houses, condos, and commercial spaces.

Apartments are often found in multi-story buildings and are popular for their convenience, while houses offer more space and privacy. Condos combine features of apartments and houses and are managed by a homeowners' association.

Commercial spaces include shops, offices, and warehouses, catering to businesses.

Each type of property offers different benefits and options for buyers looking to invest in Addis Ababa's real estate market.

What's better: buy or rent?

(If you're keeping it for yourself and not renting it)

Whether you're considering settling in Addis Ababa or already living there, you might be pondering the buy vs. rent decision in this dynamic Ethiopian capital.

Without a doubt, you should buy if you want to acquire equity and have more control over your living situation.

One data can help you make a decision - the property price-to-rent ratio. This helps you understand the connection between rental income and the property's current price in terms of years.

According to Numbeo, the property price-to-rent ratio in Addis Ababa is around 10.32, which is quite low.

It means that, on average, you would only need 10 years of rental payments to actually purchase a property.

Property prices in Addis Ababa

On average, according to the last data from Central Statistical Agency of Ethiopia, buying a property in Addis Ababa would cost you around $1,680 per square meter.

Obviously, there is a significant spread. The value of a square meter for a condominium in Bole might differ from a traditional home in Piassa. You'll get a more detailed in our pack for buying property in Addis Ababa and in Ethiopia.

To put things in perspective, it is 11 times less (yes, you read it correctly) than the prices in the center of New York.

However, housing prices in Addis Ababa are higher (33%) than in Kampala.

The most expensive neighbourhoods in Addis Ababa are probably Bole, Cazanchis, and Gullele, while the most affordable neighbourhoods are likely Akaki Kality, Kirkos, and Nifas Silk Lafto.

Addis Ababa Property Price per Square Meter


First and foremost, we have to acknowledge that Ethiopia is, as we speak, a very fragile country. The last Fragile State Index that has been reported for this place is 99.3.

Don't forget about this when considering whether it's a good idea to buy a property in Addis Ababa.

If we look at more data, we can see that, according to the IMF’s forecasts, Ethiopia's economy is expected to soar by 29.4% in the coming 5 years, resulting in an average GDP growth rate of 5.9%.

If you want to invest in real estate in Addis Ababa it's a good thing because a growing economy usually means people earn more, so they can buy property for themselves or as an investment, causing property demand (and then prices) to increase.

Also, in Ethiopia, the average GDP per capita has changed by 15.2% over the last 5 years. Almost no country has done better.

This is a strong positive signal: housing prices in Addis Ababa might become more expensive in 2024 and later on.

Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Ethiopia right now.

Buying property in Addis Ababa

Buying real estate in Addis Ababa can be difficult due to the lack of reliable and updated information about the process. That's why we have created the pack to buy property in Addis Ababa and in Ethiopia.

Buying process

Inside our pack, we've outlined the complete buying process, including a detailed breakdown of prices and yields per area, tips for negotiating the price, and information about mortgage options.

Here, we're presenting you with a more straightforward version.

This is the step-by-step process to purchase a property in Addis Ababa:

  1. Research Addis Ababa's property market and set a budget.
  2. Engage a licensed Ethiopian real estate agent.
  3. Identify suitable properties and visit them.
  4. Conduct due diligence and obtain a "Tena Yistilign" report (encumbrance certificate).
  5. Negotiate the price and terms with the seller.
  6. Sign a legally binding "Merkato" agreement with the seller.
  7. Pay a deposit to secure the property.
  8. Obtain the "Land Holding Certificate" from the Addis Ababa Land Management Bureau.
  9. Arrange financing and acquire necessary approvals from the National Bank of Ethiopia.
  10. Pay the remaining balance and transfer fees.
  11. Register the property with the Ministry of Urban Development and Construction.
  12. Finally, receive the title deed and complete the property transfer process.

Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Ethiopia.

Make a profitable investment in Addis Ababa

Better information leads to better decisions. Save time and money. Download our guide.

buying property in Addis Ababa

Where to find a property

Looking for your dream property in Addis Ababa? These websites can help:

  • RealEthio - A leading real estate agency in Addis Ababa, Ethiopia, helping you find homes, offices, and land properties.
  • Ethiopia Property Centre - A prominent real estate and property website in Ethiopia, offering listings for buying, renting, and leasing properties across the country.
  • Ethiopian properties - Ethiopia's top property portal, featuring a wide range of residential, commercial, and vacation rental properties.
  • Ethiopia realty - Ethiopiarealty is a real estate website providing a diverse selection of properties for sale and rent in Addis Ababa, Ethiopia.
  • EthiopianHome - is a real estate website offering property listings, rental services, and property management in Addis Ababa, Ethiopia.

Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Ethiopia.

Which properties for which budget?

As mentioned before, the average price per sqm in Addis Ababa is $1,680. A 1-bedroom property with 60 square meters of space would cost approximately $101,000, and a 2-bedroom with 85 square meters of space would cost approximately $143,000.

However, prices will differ based on the attributes of the property and its specific location.

Prime property locations in Addis Ababa tend to come with higher price points. An apartment in Bole might cost around $190,000, while a property in Old Airport could be about $180,000.

Certainly, certain areas are more affordable. You could find a house in Lideta for $130,000, or you may encounter a house in Akaki Kality priced at only $110,000.

Find a more detailed price list in our full pack for buying property in Ethiopia.

Risks and pitfalls

Here are the main pitfalls when buying a property in Addis Ababa, Ethiopia:

  • Land lease system: Properties are often on long-term leases rather than full ownership, impacting long-term investment viability.
  • Informal settlements: Be cautious of properties in informal settlements with uncertain legality and limited services.
  • G+1 restrictions: Height limitations on buildings can hinder expansion and rental income potential.
  • Infrastructure gaps: Uneven infrastructure development may affect property accessibility and value.
  • Foreign ownership restrictions: Foreigners may face limitations on the number of properties they can own.
  • Land dispute risks: Historical land conflicts and unclear boundaries may lead to ownership disputes.
  • Unregistered properties: Informal property sales risk lack of official registration and legal protection.
  • Market speculation: Rapidly changing property prices may lead to investment uncertainty and overvaluation.

We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.

real estate Ethiopia

Everything you need to know is included in our Ethiopia Property Pack

Living in Addis Ababa

Living in Addis Ababa is an exciting and vibrant experience, with plenty of opportunity for growth and a unique culture that makes it a great place to invest in property.

Cost of living

The cost of living in Addis Ababa is relatively low compared to other cities in the world. Prices for basic groceries and services are generally affordable, while rent and other living expenses can be quite high.

Here are some examples to better understand the cost of living in Addis Ababa, Ethiopia:

  • Tej (traditional Ethiopian honey wine): $5 for a bottle at a local tej bet (bar).
  • Rent for a one-bedroom apartment in Bole neighborhood: $600/month.
  • Injera and wot (traditional Ethiopian meal) for two at a local eatery: $20.
  • 1.5-liter bottle of St. George beer: $2 at a supermarket.
  • Electricity bill for an 85m² apartment using EEU (Ethiopian Electric Utility): $50/month.
  • Monthly membership at Capital Gym in Kazanchis: $40.
  • Ticket to a movie at Century Mall: $8.
  • Cup of Ethiopian macchiato coffee at Tomoca Coffee: $2.

Neighbourhoods and spots

Since we want to explain things clearly, we made a table that tells about the neighborhoods in Addis Ababa. For yields, prices and rents, check our property pack.

Neighborhood Description Strengths Weaknesses


Bole is a bustling and cosmopolitan area, known for its vibrant nightlife, upscale shopping malls, and proximity to the airport.

Entertainment options, international restaurants, and convenient access to the airport.

High cost of living, traffic congestion, and noise pollution.


Piassa is the historic heart of Addis Ababa, characterized by its traditional architecture, bustling markets, and cultural attractions.

Rich cultural heritage, historic sites, and vibrant local markets.

Lack of modern amenities, overcrowding, and limited parking.


Kazanchis is a central business district, home to numerous corporate offices, hotels, and government institutions.

Business opportunities, proximity to major offices, and good transport links.

Expensive commercial rents, lack of green spaces, and heavy traffic.


Merkato is one of Africa's largest open-air markets, offering a wide variety of goods and bustling trade activity.

Diverse shopping options, vibrant market atmosphere, and affordable goods.

Congestion, limited parking, and occasional security concerns.


Lideta is a residential neighborhood with a mix of commercial establishments, offering a balanced urban lifestyle.

Residential amenities, proximity to the city center, and a range of shops and restaurants.

Some parts may lack green spaces, and traffic can be heavy during rush hours.

Akaky Kaliti

Akaky Kaliti is a rapidly growing area, known for its expanding housing projects and commercial developments.

Affordable housing options, commercial growth, and improving infrastructure.

Some parts may still lack amenities, and traffic congestion is increasing.

Nifas Silk-Lafto

Nifas Silk-Lafto is one of the largest sub-cities in Addis Ababa, known for its diverse neighborhoods and urban development.

Wide range of residential options, cultural diversity, and various commercial areas.

Can be densely populated, and some areas may have limited public services.


Gulele is a mix of residential and industrial areas, offering a balance between urban living and economic activity.

Industrial opportunities, proximity to the city center, and residential options.

Some parts may experience noise pollution and limited green spaces.

Life in Addis Ababa

Addis Ababa is Ethiopia's economic hub, with a rapidly growing economy driven by the service sector, such as banking, finance, transport, tourism, and telecommunications. In recent years, the city has seen an influx of investments from both the public and private sectors, resulting in increased economic growth and development.

What expats usually like the most in Addis Ababa is the city's unique blend of African, European and Middle Eastern culture, as well as its great food and vibrant nightlife.

Also, you have to know that Addis Ababa's altitude can lead to cooler temperatures, and it faces challenges related to water access and sanitation.

A good point for a property investor - Addis Ababa has a light rail system called the Addis Ababa Light Rail Transit (AALRT), which opened in 2015.

Access to healthcare in Addis Ababa is generally considered to be of good quality and relatively affordable.

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invest real estate in Addis Ababa

Renting out in Addis Ababa

This section is for you if your goal is to buy a property and rent it out to generate income.


Tenant Profiles in Addis Ababa

If you decide to buy and rent out to long-term tenants, you should target expatriates, international students, and local professionals in Addis Ababa. Additionally, short-term tenants such as tourists, business travellers, and volunteers may be an option.

Here is a little summary table we've made for you.

Property type and area Profiles of potential tenants What they are looking for Expected monthly rent in $

Apartment in Bole

Expats, diplomats

Modern amenities, international community

$800 - $1500

Villa in Old Airport

Expat families

Spacious living, security

$1500 - $3000

Studio in Kazanchis

Young professionals

Central location, access to businesses

$300 - $600

Apartment in Lideta

Local residents, middle-income

Convenient facilities, transportation

$400 - $800

Condominium in CMC

Families, professionals

Modern living, amenities

$600 - $1200

Apartment in Megenagna

Local residents, middle-income

Accessible to services, markets

$300 - $600

Residential Compound in Summit

Upper middle class, expats

Exclusive living, security

$1500 - $3500

Rental yields

These days, Addis Ababa presents attractive opportunities in terms of rental yields. In fact, you can easily achieve yields above 9% due to the city's growing population and demand for rental properties.

In Addis Ababa, rental yields are typically highest for properties in the city centre and in the established residential areas, as these tend to be in high demand from tenants due to their convenient location and access to amenities. Properties in the suburbs and outlying areas, while cheaper, usually generate lower rental yields due to lower tenant demand.

For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.


You could also decide to rent short-term to business travelers, expats, and tourists visiting Addis Ababa for its many attractions and activities. Additionally, you could also attract students studying abroad at one of the city's many universities.

If you decide to go with that option, look for properties in Bole, Kirkos, and Cazanchis, as these are some of the most popular and sought-after areas in the city for short-term rentals. Additionally, look for properties in the surrounding neighborhoods of Bole, such as Saris, Gurd Shola, and Nefas Silk Lafto.

Currently, there are approximately 1,565 active Airbnb listings in Addis Ababa, reflecting a highly dynamic and bustling short-term rental market. The average daily rate stands around $53.

You have the opportunity to generate some additional income stream then. According to online testimonials and analytics platform like AirDNA, Guesty and Inside Airbnb, people who offer short-term rentals in Addis Ababa can make around $400 per month. Also, the average occupancy rate is estimated at 33%.

Is it worth buying real estate in Addis Ababa then?

Certainly, let's cut to the chase. Is it worth buying a property in Addis Ababa? Well, it depends on your circumstances.

If you're in it for the long haul, like planning to call Addis Ababa home for years to come, buying can be a smart move. You get equity, stability, and, with a property price-to-rent ratio of about 10.32, it often makes more financial sense than renting. Plus, if you're an investor, Addis Ababa's growing economy and increasing GDP per capita could mean rising property demand and prices, potentially making your investment pay off.

However, if you're just passing through or not staying long-term, buying might not be practical. The property market here can be complex, and you might not see returns quickly. Foreigners should watch out for ownership restrictions. There's also the land lease system, uneven infrastructure, and the risk of overvaluation due to rapidly changing prices.

So, consider your goals and do your homework. For some, Addis Ababa can be a real estate gem; for others, it might not be the right fit.

Make sure you understand the real estate market in Addis Ababa

Don't rush into buying the wrong property in Ethiopia. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.

real estate market Addis Ababa

The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.