Government Creates New Company to Help Kenyans Own Cheap Homes

  • The government is in the final stages of creating a company that will enable Kenyans to own houses at affordable rates.

    The Kenya Mortgage Refinance Company will be fully operational by the end of the month and is set to receive Ksh16 Billion from the World Bank.

    Treasury CS Henry Rotich confirmed that plans were underway for the company that will offer cheap loans to banks to target civil servants, self-employed persons, or salaried employees with a mortgage of up to 30 years to reduce the pressure on repayment.

    The loans will be limited to a minimum of Ksh1 million and a maximum of Ksh15 million.

    [caption caption="CS Henry Rotich"][/caption]

    “We are engaging a consultant to develop a detailed business plan which will enable potential shareholders do appraisals and make informed investment decisions.

    “KMRC will contribute to the broad objective of the Government of Kenya to deliver 500,000 affordable homes by 2022 targeting households with incomes of up to Sh100,000 per month,” the National Treasury said in a document pitched to bank bosses and Sacco CEOs.

    An Initial capital funding of Ksh1.5 billion will be released in the first tier of the project through loans from international financial institutions and the government.

    The new plan is in line with President Uhuru Kenyatta's Big Four Agenda plan to build 500,000 affordable homes in all major cities by 2022.

    According to the plan, 350,000 jobs will also be created and the contribution of the construction sector to GDP will be increased to 14 percent.

    To enable this, the government plans to reduce corporate tax for developers constructing at least 400 units per year and establish the National Social Housing Development Fund to provide funds.

    [caption caption="File Photo of Apartments"][/caption]