Dream of property ownership inches closer to reality


Housing demand, especially in Kenya’s urban areas, has been estimated at 250,000 units against an estimated annual supply of 50,000. But of the 50,000 units, only an estimated 1,000 are available to the lower income segment of the housing market while the bulk, 49,000 units,are for the upper middle and high-end market.

“The housing issue is therefore, two pronged: affordable housing not available;and the available housing not being affordable,” says Housing Principal Secretary Charles Mwaura.

The deficit is mainly attributed to the rapid population growth of 2.6 per cent annually, compared with the global average of 1.2 per cent, and an urbanisation rate of 4.4 per cent against the global average of 2.1 per cent.And this imbalance in shelter is what the government is hoping to cure through the Affordable Housing pillar of President Uhuru Kenyatta’s Big Four Agenda.

“If the fight for independence was about ownership, the dream of my generation is to make every Kenyan a property owner. Owning a decent home is a Kenyan dream. We will make that dream come true,” the head of State promised during the 2017 Jamhuri Day celebrations at Kasarani Stadium in Nairobi.

Since then, the government has earmarked and reserved 7,500 acres for the project in 59 towns across the country in it’s plans to facilitate the construction of at least 500,000 affordable houses by 2022, the PS says. The houses will be disbursed to Kenyans who will be required to pay mortgage amounts that are equal to the amount they are currently paying in rent.

This will be possible through the Kenya Mortgages Refinancing Company (KMRC) that is expected to commence operation by February next year.

“KMRC will provide medium and long term liquidity to primary mortgage lenders including cooperatives. The Government is also in the process of operationalising the National Housing Development Fund (NHDF) to provide a housing aggregrator and off-take,” he said.

This is in addition to an online housing portal, a component of NHDF that will aggregate demand and segregate the market according to affordability and preferences. This portal will also provide a platform for developers to showcase their products and technologies for prospective buyers to sample and startbuying either by tenant purchase or, mortgage.

“To this end we have engaged a consultancy firm to undertake a National Master-plan for the affordable housing programme. The Master-plan will establish the demand and affordability of housing in all the counties and further identify available land for affordable housing development,” he said.The President already approved an amendment to the Income Tax Act that will see buyers under the scheme get a 15 per cent relief on their gross monthly earnings. First-time home buyers will also be exempted from stamp duty equivalent to 4 per cent of the value of the property, after the President also signed changes to the Stamp Duty Act into law.

About Sh18.4 billion has been allocated for this purpose, with further funds set to come from the proposed NHDF to which employees will contribute 0.5 per cent of their monthly salary (to a maximum of Sh5,000), with employers matching the contributions.

Mwaura says the government has already identified more than 20 industrial Building System (IDS) providers, suppliers and manufacturers whose building technologies can produce quality, affordable units in very short times.

“These providers will showcase their materials and technologies to the sector so that it can appreciate available technologies aimed at reducing construction cost as well as time while maintaining the quality,” the PS said.

And to further lower the cost of construction, the government will service the lands with key infrastructure such as roads, water, electricity, sewer, telecommunication services, security, educational facilities, health facilities and transport services.

“This will reduce the cost of construction and the burden on the developers thus making the resultant housing loots affordable.”

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