NHC seeks Sh135b for affordable housing units

National Housing Corporation houses in Nairobi West. [Wilberforce Okwiri, Standard] National Housing Corporation (NHC) will be banking on partners to raise the Sh135 billion it needs to deliver 100,000 units of affordable housing in the next five years. The State-owned corporation has set its eyes on building at least 10 per cent of the one million housing units that President William Ruto's administration plans to deliver during his first term in office. This target has been broken down to 200,000 units annually. NHC Chief Executive David Mathu said the corporation is in the process of reviewing and recommending a strategic plan for the period 2023 to 2027 that will rope in new partners. Mr Mathu said even if the corporation were to allocate the newly implemented housing levy, that would still be inadequate to realise the 100,000 units. "We require at least Sh135 billion and we can't just be in a position to mobilise this capital internally. And that is why we have started partnering with critical resources that can subsidise these costs," he said. One of these partnerships is acquiring land from counties which he said would slash the development costs by 30 per cent. "As a quantity surveyor, I can tell you for sure that over and above the construction costs, the cost of land is critical. So when the county government can give us land, zero-rated, we already start reducing our overall costs of a unit by 30 per cent," he said. The NHC boss was addressing attendees at the just concluded Affordable Housing Conference held in Mombasa, where he was sharing his views on the importance of partnerships with the government and the private sector. Single-digit loans The annual conference was organised by Kenya Mortgage Refinance Company (KMRC), a State-backed mortgage financier that facilitates borrowers to access single-digit loans through a partnership with financial institutions, among them banks and Saccos. Mr Mathu said that when it comes to the private sector, the country has a good policy on Public Private Partnership (PPP) and the corporation has an internal joint venture policy. "And we are currently working very closely with the International Finance Corporation (IFC), who are part of the World Bank, to develop the first housing units on PPP in our Stoni Athi project," said Mr Mathu. Mr Mathu, who was part of the panel discussion, was joined by Director of State Department for Housing and Urban Development James Maina, and Cooperative Housing Union Chief Executive Mary Mathenge. Ms Mathenge insisted that when affordable housing units are being put up, the community has to be involved. This will determine if the units fit the market - a challenge that has been raised by several players in the sector. Market rates Of the 50,000 units being developed every year, data from the State Department for Housing and Urban Development shows that less than two per cent fit the affordable housing criteria. The rest are market rates where the majority of the low and middle-income earners cannot afford to purchase. "When you talk about affordability, and you do not engage the community, it can develop to what we call a white elephant," she said." But when you do, you can know and assess the impact you will package a project that speaks on what they can afford," "Housing is a socio-economic development. When you involve them (community) they feel they are moving from one step to the other." Mr Maina stressed the role of partnerships, saying it has enabled some 7,000 units to take off across the country. These are part of the 200 units in each of the 290 constituencies where the government seeks to put up affordable housing. He said other areas where the government has an interest are identifying land and calling for strategic partners under what is referred to as design, and build. finance and transfer. "That once completed, they are transferred to Kenyans who will buy through Tenant Purchase Schemes (TPS), which we are closely working with NHC who are managing the TPS," said Mr Maina. He cited TPS as an attractive model of uptake of units which attracted developers and informed some 26,000 units being put up across major towns in the country. Nakuru and Ruiru are among these towns. "These programs are more attractive in major towns," he said.

NHC seeks Sh135b for affordable housing units

Get Full Access for Ksh299/Week.

Stand With Bold Journalism.
Stand With The Standard.

Related Topics

Popular this week

Latest Stories

The Standard Insider

Digger Classified

GET OUR NEWSLETTER

CONNECT WITH US

FOR THE LATEST JOB ADVERTS

DIGGER JOBS

Digger Motors

Digger Real Estate

NHC seeks Sh135b for affordable housing units

Get Full Access for Ksh299/Week.

Stand With Bold Journalism. Stand With The Standard.

Related Topics

Popular this week

Latest Stories

The Standard Insider

Digger Classified

GET OUR NEWSLETTER

CONNECT WITH US

FOR THE LATEST JOB ADVERTS

Stand With Bold Journalism.
Stand With The Standard.