· Capital Ethiopia · Eyasu Zekarias
Real Estate Lease Price Hikes Erode Investor Confidence in Ethiopia
Topics:LandLaw and policyInvestment
Summary of the Capital Ethiopia report
Sheger City has told homeowners in the CCD gated community to sign new lease agreements at about 4,541 birr per square metre, with a threat to seize and auction the property of those who refuse. Lawyers quoted by Capital say the federal lease law does not allow a city to raise the price of a signed lease.
Key points
- A Sheger City Revenues Authority directive requires CCD residents to sign new lease agreements and pay adjusted fees.
- Documents from January 2026 put the revised valuation at about 4,541 birr per square metre.
- The city warned that it can seize and auction the property of owners who refuse.
- Legal experts say Proclamation No. 721/2011 has no clause that lets a city raise a lease price after signing.
Real.et analysis
Capital reports on a lease payment dispute between the Sheger City Administration and residents of the Country Club Developers (CCD) gated community. A directive from the Sheger City Revenues Authority tells residents to sign new lease agreements and pay adjusted fees. This applies even to owners who have held title deeds for decades. Documents from January 2026 put the revised value at about 4,541 birr per square metre. The city has warned that it can seize and auction the property of owners who refuse, under tax administration law.
Legal experts quoted in the report say the move has no clear base in federal law. Arba Beyene of Ethio Alliance Advocates LLP points to the Urban Lands Lease Holding Proclamation No. 721/2011. He says the law fixes the main terms of a lease at the start and has no clause that lets a city raise the price after the contract is signed. The city says the new price reflects market value. Analysts say the benchmark revision that the law requires every two years is meant for new land only.
What this means for owners
The dispute is not settled, and the report records no court decision. If you own a home on leased land in Sheger City or elsewhere:
- Keep your lease contract and title deed. They show the price and term agreed at the start.
- Ask for the legal base in writing. If an office demands a new contract, ask which law and article it applies.
- Get legal advice before you sign. A new agreement may replace your old terms.
What this means for buyers
A long lease is the base of most home purchases in and around Addis Ababa. Before you buy, check if the seller has paid the lease in full and if the city has made any new demand on the plot. Add this question to your title search. Experts in the report ask federal authorities to state the limits of municipal power. Watch for that guidance.
Our land lease guide explains lease terms and payments. A related story covers homeowners who risk losing title deeds. Addis Ababa has also raised its lease benchmarks.