Latest Financial Stability Council (FSC) report shows that residential real estate loans were stable between September 2024 and 2025 at P15 Billion remaining stuck at 25.1% of household credit and 16.1% of total credit. Despite rising demand for housing in Gaborone and its periphery areas, banks did not expand mortgage books, a break from the double-digit growth that characterised the market a decade ago. "Residential real estate loans were relatively unchanged between September 2024 and 2025 at P15.5 billion, constituting 25.1 percent and 16.1 percent of total household credit and total credit, respectively," researchers noted in the report. The FSC, which is a multi-body council consisting of the central bank as well as other financial agencies and institutions, noted that this muted growth meant that household debt in Botswana mainly comprised unsecured debt in comparison to other countries where household debt stock comprises mainly of residential loans.
The Council notes that Botswana’s mortgage penetration remains well below regional comparators, stating that “these proportions are very low compared with South Africa and Namibia, where mortgages constituted 61 percent and 70%, respectively, of total household loans.” The report concludes that domestic housing finance is “not commensurate with the needed development and growth path to fill the apparent need for housing, as well as the financing gap.” The loan stagnation comes against a backdrop of a cooling property market. Land scarcity in prime nodes, combined with escalating construction material prices, has further pushed house prices beyond the reach of average households. The FSC hints that affordability may be the core constraint, with households facing growing income pressures from high food inflation and growing debt piles to cover other pressing needs like education, healthcare. "At the same time, growth in incomes could be restrained relative to the increase in residential house prices over the years," the researchers noted. On the commercial side, the FSC reports that “commercial real estate (CRE) credit growth was unchanged at P5.8 billion in September 2024 to P6 billion in September 2025,” accounting for 6.3 percent of total loans.
