This archive report was first published on 12 June 2020.
President Uhuru Kenyatta's Affordable Housing Programme (AHP) has received a significant boost with six banks committing Sh335 billion in mortgages.
According to Housing Principal Secretary Charles Hinga, the banks involved are Equity Bank, KCB, NCBA, Stanbic Bank, Absa, and Housing Finance.
These institutions will provide financing to potential homebuyers, enabling them to purchase both government-built houses and units delivered by private developers registered on the Boma Yangu portal.
Mr. Hinga noted that this partnership represents significant progress, helping potential homeowners overcome financial hurdles to home ownership.
He emphasized the importance of mortgage products that reflect the financial ability of individuals, suggesting a rent-to-own arrangement that Kenyans understand and can take up with ease.
Despite the state's failure to allocate cash for the civil servants' housing scheme for the second fiscal year in a row, the commercial banks' support comes as a welcome relief.
As part of the AHP, the government will offer partial credit guarantees that will cover up to 20% of approved loans, derisking potential homebuyers and enabling the self-employed and informal business owners to access bank mortgages.
Over 300,000 Kenyans have registered for the AHP on the Boma Yangu portal, with more than 25,000 active contributors.
Registered members who have contributed the minimum 10% of the value of the houses they are interested in will qualify for allocation of the units and benefit from the partial credit guarantee to access mortgage finance from the six banks.
Under the AHP, first-time homeowners are not required to pay stamp duty and will benefit from an affordable housing tax relief of up to Sh9,000 per month.
Published on June 12, 2020.
