Residential Real Estate - Madagascar

Madagascar

The market segment of Residential Real Estate market in Madagascar is forecasted to achieve a significant milestone, with a projected value of US$239.50bn by the year 2024.
This projection indicates a favorable growth trajectory for the market, with an expected compound annual growth rate (CAGR 2024-2029) of 4.90%.
As a result, the market volume is anticipated to expand to US$304.20bn by 2029.
In terms of global comparison, it is noteworthy that China is expected to generate the highest value in the Real Estate market, reaching a staggering US$112.9tn in 2024.
Residential real estate prices in Madagascar have been steadily increasing due to growing tourism and foreign investment.

Key regions: Europe, Brazil, France, Asia, United States

Market

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Analyst Opinion

Madagascar, an island country located off the eastern coast of Africa, is experiencing significant development in its Residential Real Estate market.

Customer preferences: In recent years, there has been a growing demand for residential properties in Madagascar. This can be attributed to several factors, including an increase in population and urbanization. As more people migrate to urban areas in search of better job opportunities and improved living standards, the demand for housing has surged. Additionally, the rising middle class in the country has led to an increased desire for homeownership, further driving the demand for residential real estate.

Trends in the market: One of the key trends in the residential real estate market in Madagascar is the development of gated communities and housing estates. These developments offer a range of amenities and services, such as security, recreational facilities, and access to schools and healthcare facilities. This trend is driven by the desire for a safer and more convenient living environment, particularly among families and individuals with higher disposable incomes. Another trend observed in the market is the rise of affordable housing projects. With a significant portion of the population still living in informal settlements and inadequate housing, there is a growing need for affordable and decent housing options. Developers are responding to this demand by constructing housing projects that cater to low and middle-income households. These projects often benefit from government support and incentives, making them more accessible to a wider range of buyers.

Local special circumstances: Madagascar's unique geography and biodiversity make it an attractive destination for tourists and investors alike. The country's natural beauty, including its stunning coastline and diverse wildlife, has led to an increase in tourism, which in turn has had a positive impact on the residential real estate market. Investors are drawn to the potential for rental income from holiday homes and vacation rentals, especially in popular tourist destinations.

Underlying macroeconomic factors: The growing economy of Madagascar is a key driver of the residential real estate market. The country has experienced steady economic growth in recent years, supported by sectors such as agriculture, mining, and tourism. This growth has resulted in increased income levels and improved purchasing power among the population, fueling the demand for residential properties. Furthermore, government initiatives and policies aimed at promoting investment and economic development have also contributed to the growth of the residential real estate market. These include tax incentives for developers, streamlined permitting processes, and efforts to improve infrastructure and utilities. In conclusion, the residential real estate market in Madagascar is experiencing significant development due to increasing customer preferences for gated communities and affordable housing. The country's unique geography and growing tourism industry also contribute to the market's growth. Additionally, underlying macroeconomic factors, such as steady economic growth and government initiatives, play a crucial role in driving the demand for residential properties.

Methodology

Data coverage:

Figures are based on total and average value of residential real estate, residential estate transactions and leases.

Modeling approach:

Market size is determined by a combined top-down and bottom-up approach. We use national statistics, international organizations, and industry associations to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country specific industry associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita.

Forecasts:

We use a variety of forecasting techniques, depending on the behavior of the market, for instance, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.

Additional Notes:

Data is modeled using current exchange rates. The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.