Cost of owning a home can be reduced: Experts

The realisation of affordable housing is a headache for many, including the Government.

While the costs of owning a home or a house are still beyond the reach of a bigger percentage of Kenyans, experts argue that these costs can be reduced. 

“The Government should be more innovative in exploring workable ways to encourage private firms to build cheap houses. It should develop building technologies to bring down the cost of construction,” says Morvin Achila, an economics lecturer at the University of Harar, Somaliland. 

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The cost of land should also be reduced, says Achila, adding that land value concept should be considered as an alternative to addressing the high cost of buying a house. The Government should give out under-utilised parcels of land to private developers to construct affordable houses, he says.

Then there is the question of accessing financing. “If banks can reduce interests on loans for mortgages, most low- and middle-income earners will be able to own houses and homes in major towns,” says John Osike, a building and planning officer with the Nairobi County Government. 

It is the financing aspect that the Government hopes to address with the Kenya Mortgage Refinance Company (KMRC). KMRC has been established to work with the banking sector and co-operative movement through saccos to make available affordable mortgage finance for those wishing to own houses and homes. It will extend the duration of home loans. It is also aimed at helping drive interest rates to a single digit.

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Osike says the affordable housing concept, one of the Big Four agenda pillars, should be encouraged “but this should not lead to taxing of employees’ salaries without their consent”.

Odoyo Owidi, the chairman, Lake Basin Development Authority says Kenya’s first medium-term goal of 2009/2012 of Vision 2030 strategy had a target of increasing housing production from 35,000 to 200,000 annually.  

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Affordable housingHome OwnershipDr PesaHousingReal Estate