A study by Addis Ababa University, Addis Ababa Savings & Houses Development Enterprise (AASHDE), Commercial Bank of Ethiopia and Ministry of Urban Planning and Housing, reveals that new 40/60 condos are worth an additional 2,100 birr per square meter from their current price.
The new price, awaiting the approval of the Vice Mayor of Addis Ababa City Administration is expected to apply to the 1292 completed condos to be transferred in short period of time.
When the 40/60 condo housing schemes began in 2013, AASHDE set the price at 2289, 3300 and 3860 birr per square meter for one, two and three bedrooms respectively. However, increasing construction and labor costs have forced AASHDE to undergo a study to value the homes according to current market prices. The revaluation also considers the current price of land, water, electricity and building design.
If the vice Mayor approves the revaluation, the prices of one, two and three bedroom condos - currently at 162,000, 250,000 and 386,000 birr respectively - will increase accordingly by the square meter of the apartments.
Out of the total number of 160,000 residents registered under the scheme, only four percent have registered for one bedroom condos, 46 percent for two bedroom condos with the remaining half registered for three bedroom condos.
Amare Kassa, Communications Officer in AASHDE told Capital that the price increasing is within the confines of the law and does not violate the regulation on condos.
“When people registered in the 40/60 scheme, they signed an agreement with banks which stated there would be price increase if there are changes to the cost of materials and labor. Based on this rule, the study was conducted and has yet to be approved by the board headed by the Vice Mayor of the city.”
Currently, 38,709 condominium units are under construction on 12 sites. However, due to poor capacity of contractors and consultants, and inadequate government supervision, most of the projects are behind schedule. Only 1,292 housing units in Senga Tera and Kality are on schedule for delivery.
The enterprise, facing serious backlash for delaying the delivery of condominiums, is targeting to build 75,000 new condominium units under the 40/60 scheme over the next five years.