Kenya’s dream of affordable housing has been a cornerstone of national policy since the country’s independence, with successive leaders promising homes that every family can afford. Yet, decades later, the gulf between these political pledges and the everyday reality for many Kenyans remains stark.
From urban workers helping to build Nairobi’s gleaming skyline but living in overcrowded informal settlements to rural families facing their own daunting housing challenges, access to affordable shelter continues to elude large segments of the population. Despite the government’s renewed focus on ambitious new housing programs, questions linger: will these efforts finally deliver on the long-standing promise of secure and affordable homes for all Kenyans, or will deep-rooted financial, social, and bureaucratic barriers continue to hold people back?
Current Housing Crisis
While successive presidents from Daniel Arap Moi to William Ruto have acknowledged the goal to achieve cheap housing, there is still a wide gap between official commitments and many citizens’ actual realities.
According to the law of demand, as housing prices fall, the quantity desired rises. However, access to money through wages, savings, or loans can increase housing demand by allowing people to purchase a property. However, when money is scarce, such as during periods of unemployment or when fewer people qualify for loans, demand falls. Kenya’s annual housing demand is over 200,000 units, but only about 50,000 homes are built each year, resulting in an annual shortage of 150,000 units, primarily affecting low-income earners who receive a small share of new housing units. The World Bank has assessed Kenya’s unemployment rate at 5.7% in 2024, slightly higher than the 5.6% recorded last year, with an average household income of approximately Ksh 20,000. ($156)
To effectively address Kenya’s housing crisis, it is necessary to handle both the supply and demand sides of the market. Concentrating on just one of them will enhance certain aspects of the housing market but will not result in long-term change. When we look at the supply side, we can see that there isn’t enough housing to meet demand. The solution: build more. However, merely adding more homes will not fix the situation. This is where the demand side enters the equation. Effective demand management policies are required. These policies should encourage transparency in implementation, public participation, and stronger protections for consumers and sellers.
Advancement in the Face of Obstacles
Kenya’s Affordable Housing Programme is making great progress, despite continued hurdles. President William Ruto has committed significant resources to this project, including Ksh 4.4 billion to promote micro, small, and medium enterprises (MSMEs) in the housing supply chain. This financing is intended to boost local manufacturing and drive job growth, with over 160,000 jobs said to have been created.
In a recent update, the government stated plans to deliver 1,080 new studio units in Nairobi, with affordable mortgage options of Ksh 3,200 per month by the end of the year. This move is part of a larger goal to make home ownership more accessible to Kenyans, shifting away from the notion that mortgages are solely for the fortunate few.
According to recent statistics from the Ministry of Lands, Public Works, Housing, and Urban Development, the Affordable Housing Programme has expanded to 40 counties, producing approximately 206,000 jobs and contributing significantly to the country’s economic growth. The ministry added that the effort had resulted in a 40% rise in mortgage refinancing, making homeownership more accessible to many Kenyans. The program currently includes the development of around 124,000 housing units. In the fiscal year 2024-25, the government plans to construct 66,155 affordable housing units and 52,758 social housing units.
Voice of Concern
Despite these attempts, many Kenyans are still unsure about the implementation. Peter Njoroge, an engineer and constituency liaison officer in Starehe, discussed what affordable housing meant to him, reflecting on his childhood in government housing due to his father’s public service post. “I have watched Nairobi grow,” Peter said. “I’m not the type of person who claims I got to Nairobi and found things exactly as they are. I’ve watched it grow from a city container to what it is now. When I arrived in Nairobi, Moi Avenue was not named Moi Avenue. Many of the changes we witness seem strange to me.”
While the concept of affordable housing appears attractive, Peter expressed serious concerns regarding its implementation.
He acknowledged that many people are concerned that these projects do not actually assist those they are intended to help. Unlike previous programs, which involved the government funding housing developments and offering mortgages to residents, the current strategy requires paid workers to have deductions made from their pay to fund the construction of these homes.
“In the past, workers were not required to contribute monetarily to home developments. “Now, it appears that there is a lack of transparency about how these deductions are managed and how contributors will be chosen for housing,” he stated. Many people are pressured to give without knowing who will get the homes or when they will be accessible.
Recently, the dispute was elevated to the Supreme Court, which found that public participation had taken place. However, Peter questioned the sincerity of this interaction, claiming that in his experience across 17 constituencies in Nairobi, meaningful participation from locals was largely lacking. “If public participation happened, it was merely a formality,” he said.
Peter cited previous experiences in neighbourhoods like Kibera, where promises of better housing were frequently unfulfilled. “In the 1980s, slum dwellings were razed to make way for new apartments, although very few of the original tenants remained in them. Now, these buildings are full of people from outside the community, raising concerns about the existing housing project.”
As concerns grow, Peter highlights new deductions from pay checks intended to fund house construction. “Many people are no longer following the intricacies of these deductions. They come on our pay checks without explanation, and it’s difficult to keep track of what’s being deducted. After further loans and deductions, there’s almost nothing left. It’s frustrating to contribute to something we don’t understand.”
Despite his frustrations, Peter emphasised the Affordable Housing Program’s potential. “This program has the potential to revolutionise both the housing landscape and the economy. It’s more than just giving shelter; it’s about establishing an atmosphere in which families may thrive.”
He also highlights the importance of balancing supply and demand in order to develop a sustainable housing market that truly meets the needs of all Kenyans. Only then will the Affordable Housing Program become a pillar of national development.
Numbers
The Affordable Housing Act of 2024 defines affordable housing as housing that costs 30 percent or less of a person’s monthly salary. A family that spends more than 30% of its income is termed cost-burdened, which implies they frequently have to make difficult decisions about other necessities.
The Centre for Affordable Housing Finance in Africa (CAHF) reports that 61.3% of Kenyans own homes, compared to other African countries like Angola and Algeria with 75.4% and 74.8% national home ownership rates, respectively. The national homeownership rate stands at approximately 21.3% in urban areas, sprawling the national average of 61.3%, while 78.7% of urban dwellers rent.
The government’s initiatives to make affordable housing aim to improve these rates by offering the following:
Social housing unit: A house targeted at a person whose monthly income is below Ksh 20,000;
Affordable middle-class housing unit: A house targeted at a person whose monthly income is over Ksh 149,000;
Affordable housing unit: A house targeted at a person whose monthly income is between Ksh 20,000 and Ksh149,000;
Rural affordable housing unit: A house targeted at a person living in any area that is not an urban area.
Launched in 2022, the Mukuru project is part of a larger initiative to construct 200,000 housing units nationwide. Units are priced at Ksh 840,000 with a 10% deposit (84,000 Ksh) required upfront. If a mortgage is taken out to cover the balance (756,000 Ksh), the monthly repayment would likely range between 8,000 and 10,000 Ksh, depending on loan terms and interest rate. This amount exceeds the 30% threshold of Ksh 6,000 set by the Affordable Housing Act for an average Kenyan household earning 20,000 Ksh. The monthly repayments are more than what the policy considers sustainable, indicating that families are cost-burdened, which often forces them to make difficult decisions about other necessities.
Ultimately, the promise of affordable housing in Kenya is a live commitment that changes with the times and the needs of its citizens.
As we navigate this, one thing becomes clear: despite widespread criticism of its implementation, there is a shared conviction in the benefits it may provide to Kenya. This program has the potential to revolutionise both the housing landscape and the economy. The promise of affordable housing is more than just putting a roof over your head; it’s about creating an organised, healthy environment in which families may flourish. To address the housing crisis, a comprehensive approach is necessary. That is, focusing on the demand and supply sides of the market while also incorporating social responsibility into the conversation. Both factors must work together seamlessly to produce a sustainable housing market that meets the requirements of all Kenyans.
