How you will benefit from Uhuru’s half million houses

HOW YOU WILL PAY

The Government will deduct one per cent of your gross income or Sh 5000 maximum and deposit the money in a new fund dubbed National Housing Development Fund.

Your employer will also deposit a similar amount. Confusion on exact rate is as a result of budget speech which proposed 0.5 per cent while Finance Bill put it at one per cent. Ministry of Housing and Urban Development wanted five per cent and CS Rotich has said the rate may go up progressively.

HOW YOU WILL ACCESS

The money will go into the National Housing Development Fund which can be accessed through a tenant purchase deal for those in affordable housing bracket or securitised for mortgages for those with means

Affordable housing will work like the concept sild by Simple Homes and Gakuya’s Ekeza Sacco where you get a house and use your rent to purchase it. Both Saccos could not deliver.

For those in the mortgage cap, the contribution can be used as a deposit when you want to buy a mortgage or interest rate buy-back to make the mortgage cheaper.

HOW TO QUALIFY

Housing ministry will create a website in early July which will assign each person an automated score on whether they fall under low cost houses, social houses or the mortgage cap.

You will be required to enter your details including your M-pesa transactions, bank records, Kenya Revenue Authority Pin for the prequalification.

The private sector will then put up 2000 houses in each county per year and those registered in the scheme will be able to book a unit and start paying for the off-plan units after registration since the one per cent is too small.

The state will then run a lottery each year to match the people who have booked to the number of units available to avoid the risk where those with money can just buy several units and rent them, thereby distorting the market.