This paper investigates the progress being made by housing microfinance (HMF) on the continent. The Center for Affordable Housing Finance (CAHF) together with its partners has long been involved in studying, understanding and lobbying for the sector. We firmly believe that it represents a critical ingredient to solving the problem of housing on the continent because it works with how the majority of the continent’s people are housed; that is incrementally and through processes of self-­‐build. There have been some notable and encouraging advances in the industry with a steady trickle of new commercial entrants into HMF. Banks, microfinance banks and general microfinance lenders are introducing it, in various shades, as a product within their lending portfolios. Some continue to expand this offering to more and more countries. New commercial entrants are a sign that HMF is still seen as a viable commercial lending operation.

Meanwhile, the lending activities of less commercially orientated organizations such as housing cooperatives and the NGO sector continue to grow in recognition of the demand and need among lower-income earners. The activities of these organizations offer an important contribution to HMF practice in their willingness to take on higher risks, as well as engage with downstream processes such as the house building process itself. They serve as an important repository of knowledge and lessons in this new industry. Further, more and more funding is coming on-­‐stream in the form of grants, loans, equity, as well as technical support, as the sector increasingly becomes an important investment destination. Africa is urbanizing fast, and urban areas are seeing that the demand and need for housing is not being met. The 2012 World Urbanization Prospects report from the United Nations emphasizes that the two biggest factors driving urbanization growth in Africa are first, the fact that Africa still has a very high natural population growth; and second that Africa’s levels of urbanization have generally been low, and the continent is in essence playing catch up. Thus, African cities may not be growing as fast as they were 10 or 15 years ago,1but compared to Asia or Latin America, Africa is still experiencing the highest rate of urbanization in the world.