Ngurare right to worry about housing, but wrong to point fingers at who failed homeowners and the homeless

Lazarus Kwedhi

Prime Minister Elijah Ngurare’s recent call for “humanity over profit” in housing loan repayments has struck a nerve. Many Namibians are struggling with repossessions, arrears, and the fear of losing homes they have spent decades paying for.

The Prime Minister deserves credit for raising the issue and forcing it back onto the national agenda. But good intentions or political speeches do not guarantee good policy, in this case, if the diagnosis is wrong, which means the cure will not work.

The Prime Minister’s central complaint is that banks offer 20-year home loans while cars are financed over five years. The implication is that banks are cruel, profit-driven, and insensitive to the humanity of borrowers. The comparison sounds powerful politically, but economics tells a different incontestable fact.

First, the math. A mortgage of N$830,000 at 9.5% interest paid over 5 years would require monthly installments of N$17,450. The same loan over 20 years costs N$7,756 per month.