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Everything you need to know is included in our Ivory Coast Property Pack
Are you considering buying real estate in the land of Cocoa? Are you curious if the prices are at an optimal point?
Different individuals have different perspectives on market timing. Your Ivorian friend might tell you that now is the ideal time to buy property, while your colleagues in Abidjan may think that prices will soon decline.
At TheAfricanvestor, when we create articles or update our pack of documents related to the real estate market in Ivory Coast, we dvocate for a fact-based mindset, rejecting unfounded opinions and baseless rumors.
After thoroughly analyzing official reports and statistics available on government websites, we have gathered solid information in a database. Here are our findings that can assist you in determining whether it's the right time to invest in real estate in Ivory Coast.
Happy reading, and let's dive in!
How is the property market in Ivory Coast these days?
Ivory Coast is, as of now, a vulnerable and fragile country
Negative
If you want to invest in properties, prioritize stability as it ensures future planning and financial security. It is an information you need as a foreigner who might buy a property in Ivory Coast.
Sadly, Ivory Coast is going through a period of great instability. The last Fragile State Index reported for this country is 85.3, which extremely low.
Ivory Coast remains vulnerable and fragile due to its history of political instability, marked by two civil wars in the early 2000s and 2010s, which have left deep-seated ethnic and regional tensions that continue to challenge national cohesion. Additionally, the country's heavy reliance on agriculture, particularly cocoa exports, makes it susceptible to global market fluctuations and climate change impacts, further exacerbating economic vulnerabilities.
It does not seem to be the right time to buy a property in this country. Let's check more data.
Ivory Coast is forecasted to grow massively
Positive
Before investing in Real Estate, look into the economic health of the country.
According to the IMF's estimations, Ivory Coast is likely to finish 2024 with a growth rate of 6.5%, which confirms the country's quick development. As for 2025, we're talking 6.4%.
That's not all - this impressive growth will keep going on since Ivory Coast's economy is expected to increase by 28.9% during the next 5 years, resulting in an average GDP growth rate of 5.8%.
The expected massive growth in Ivory Coast means there will likely be an increased demand for housing and commercial spaces, driving up property values and rental income potential. This creates a promising opportunity for real estate investors to achieve significant returns on their investments.
Now, let's delve into other metrics worth exploring.
Ivory Coast's population is growing and getting significantly richer
Positive
When considering buying real estate, population growth and GDP per capita require meticulous evaluation because:
- a growing population means more people needing homes
- a higher GDP per person means people have more money to spend on housing (which can lead to increased property value over time)
In Ivory Coast, the average GDP per capita has changed by 12.1% over the last 5 years. It is well above the average seen worldwide. Furthermore, the Ivorian population is growing (+25% in 5 years).
This means that, if you purchase a beachside house in Abidjan and rent it out, you will find that each year, you'll attract more tenants with sufficient funds to cover the rent.
If you're considering purchasing and renting it out, this trend is a good thing. Then, the demand for rentals is predicted to increase in Ivorian cities such as Abidjan, Yamoussoukro, or Bouaké in 2025.
Properties promise really attractive yields in Ivory Coast
Positive
To evaluate the profitability of a property investment, take into account the expected rental yields.
It represents the annual rental income generated by a property divided by its purchase price or market value. For instance, if a property in Ivory Coast is purchased for 50,000,000 XOF and generates 2,500,000 XOF in annual rental income, the rental yield would be 5%.
The website Numbeo indicates that rental properties in Ivory Coast promise gross rental yields from 6.1% and 8.8%. You can find a more detailed analysis (by property and areas) in our pack of documents related to the real estate market in Ivory Coast.
You won't get better yields in many places.
Everything you need to know is included in our Ivory Coast Property Pack
In Ivory Coast, inflation is projected to remain minimal
Neutral
Simply put, inflation is the general increase in the cost of living.
It's when your favorite cup of attiéké costs 2,500 West African CFA francs instead of 2,000 West African CFA francs a couple of years ago.
If you're planning to invest in a property, high inflation can offer several benefits:
- Property values often increase over time, leading to potential capital appreciation.
- Inflation can lead to higher rental rates, thereby increasing the cash flow from the property.
- Inflation decreases the real value of debt, making mortgage payments more affordable.
- Real estate can serve as a hedge against inflation, safeguarding the value of the investment.
- Diversifying into real estate provides stability during periods of inflation.
As indicated by IMF projections, over the next 5 years, Ivory Coast will have an inflation rate of 1.0%, which gives us an average yearly increase of 0.2%.
This data is suggesting that Ivory Coast is expected to have near-zero inflation then. Unfortunately, buying a property now may not lead to significant price increases or high profits in the future.
Is it a good time to buy real estate in Ivory Coast then?
Now it's time to draw our conclusions.
While Ivory Coast is experiencing impressive economic growth, it's important to remember that the country is still considered vulnerable and fragile. This means that there are underlying risks and uncertainties that could impact the stability of the real estate market. Political instability, social unrest, or economic shocks could potentially disrupt the market, making it a less secure environment for property investment in 2025.
Despite the promising economic outlook, with an expected GDP growth rate of 5.8% over the next five years, this rapid growth could also lead to increased competition for housing and commercial spaces. As demand rises, property values and rental income potential may soar, but this could also result in inflated prices. For potential buyers, this means that entering the market in 2025 might require a higher initial investment, which could limit the potential for future gains.
Additionally, the growing and increasingly affluent population in Ivory Coast suggests a robust demand for real estate. However, this demographic shift could also lead to a more competitive market, where securing desirable properties becomes more challenging. As the population becomes wealthier, the cost of living may rise, potentially impacting affordability for both local and foreign investors looking to purchase property.
While rental yields in Ivory Coast are currently attractive, ranging from 6.1% to 8.8% according to Numbeo, it's crucial to consider the broader economic context. Although inflation is projected to remain minimal, the overall economic environment remains uncertain. Investors should weigh these factors carefully and consider whether the potential risks outweigh the benefits when deciding if 2025 is the right time to invest in Ivory Coast's real estate market.
We genuinely hope this article has been helpful and informative to you!. If you need to know more, you can check our our pack of documents related to the real estate market in Ivory Coast.
-Will real estate prices go up in Ivory Coast?
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.