Libya turns to the private sector to solve its housing crisis

Libya is facing an estimated shortage of 800,000 homes, prompting plans for a new housing strategy that relies on cooperation between the government, banks and the private sector rather than state funding alone.

Speaking at the National Dialogue on “The Role of the Banking Sector in Revitalizing Housing and Urban Development Projects” in Tripoli on July 6th, Prime Minister Abdel Hamid Dbeibah said the scale of the housing crisis had turned it into more than a public service issue, describing it as an economic and social challenge affecting families across Libya, as reported by the Libya Herald.

Dbeibah’s emphasis on tackling Libya’s housing shortage comes at a time when wider economic pressures have become increasingly intertwined with the public debate over migration. Recent protests in Tripoli saw demonstrators argue that Libya lacks the capacity to absorb large migrant populations while struggling to provide housing, jobs and services for its own citizens.

These concerns over Libya’s migrant population have been amplified by broader economic pressures, including recurring fuel crises and other strains on essential services, which have contributed to a perception among some Libyans that scarce resources should be prioritised for citizens.

Dbeibah said the government’s proposed approach would divide responsibilities between different sectors. Under the plan, the state would oversee planning and provide land and infrastructure, banks would offer financing, and private developers would be responsible for construction. The aim is to create what Dbeibah described as a sustainable system that allows citizens to own homes.

Dbeibah outlined how the policy would cater for different groups within Libyan society. He said around 15 per cent of families have the financial means to build their own homes, requiring only serviced land from the state. A further 15 per cent are able to buy homes on the open market, supported by measures designed to encourage investment from property developers.

The remaining 70 per cent, however, would need long-term mortgage finance with repayments matched to their income levels.

As part of the first phase of the National Housing Programme, the government plans to complete about 150,000 unfinished housing units across various Libyan cities. According to Dbeibah, around 80 per cent of those developments remain at the concrete structure stage.

He said the state would cover the costs of land, infrastructure and the concrete structures, while homeowners would finance the completion of their properties through long-term bank loans. The proposed scheme would require a 15 per cent deposit, with repayment periods extending to either 25 or 30 years in an effort to keep monthly instalments affordable.

Dbeibah also made clear that the government would not be able to complete stalled housing projects on its own and said Libyans would need to contribute towards the cost of their homes.

Libya Herald, Maghrebi.org