Does Incremental Housing Finance Contribute to Sustainability for Africa’s Green Affordable Housing? A Scoping Literature Review

Abstract

This study conducts a scoping literature review of the contribution of incremental housing finance to the adoption of green affordable housing in Africa, grounded in sustainable finance theory. The study synthesised evidence from 33 studies conducted between 2001 and 2025, identifying major themes such as housing microfinance (31%), sustainable housing (19%), and incremental housing finance (13%). The findings show that incremental housing finance (IHF) is a subset of housing microfinance that addresses affordability and sustainability, particularly by contributing to green building practices. This study’s theoretical contribution entails situating IHF within sustainable finance theory, which is also significant in addressing affordable housing demand. It demonstrates the potential to align the provision of low-income housing with environmental objectives. This is important for banks, microlenders, and investors in the affordable housing market as a tool to understand developing market dynamics and opportunities to scale up sustainability through IHF. Without incorporating green practices in IHF, Africa’s potential for climate-resilient affordable housing would remain significantly underdeveloped.