Except in Addis Ababa, Harer, Dire Dawa, and a few other urban centers, most houses are built of mud or mortar and have thatched or tin roofs. In the rural areas the traditional thatched hut (tukul) is still the most common dwelling. As of the mid-1980s, over two-thirds of all housing units were constructed of wood and mud, and a lesser number of wood and thatch. Housing shortages and overcrowding were still major concerns as of 2000. It has been estimated that 89% of the population is living in substandard housing. Homelessness is a big problem in urban areas; it has been estimated that 80% of the residents in Addis Ababa are homeless or in substandard housing.
Housing development and finance are the joint responsibility of the Ministry of Housing and Urban Development and the Housing and Savings Bank, which was established in November 1975. The government has developed the Ethiopian Housing Cooperative to encourage Ethiopia emigrants to return and build homes.