Land prices across many African cities are soaring. This is because land is a city’s key asset. As urbanisation progresses, demand for land will rise, and therefore so will land prices, because the supply of land in cities is limited. Investments in public infrastructure, and zoning regulations that convert land to alternative uses, will also boost land value.
In fact, studies have shown that simply converting rural land to urban can increase its value by 400%.
All these changes are driven by the government and collective action, rather than by private individuals. But the beneficiaries of higher land prices will be property owners, unless there are mechanisms in place to recoup the value. Thus, city governments across Africa are seeking ways to capture this value, boost revenue and reinvest in public goods and services.
