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Blockchain offers lifeline to potential homeowners

By Fredrick Obura | May 27th 2021

Transport Chief Administrative Secretary Chris Obure, CBK Governor Patrick Njoroge and Housing PS Charles Hinga when they visited SBM Bank stand during the launch of allocation of affordable Housing to the Public at Parkroad, Nairobi.[Standard]

The government has been cracking its head over the years to find a solution to the housing deficit, currently estimated at two million units by UN-Habitat.

It’s against this backdrop that housing sits at the core of the Big Four Agenda under which the State plans to deliver 500,000 units by next year through the affordable housing programme that covers major urban areas across the country.

This will entail the use of affordable and environment-friendly building materials and efficient construction technologies.

Naftali Nyabuto, a technology expert and chief executive of M-Zawadi, argues that Kenyans should not sit back waiting for the government to deliver the affordable housing dream but embrace what technology offers.

He says technology such as blockchain and Artificial Intelligence (AI) holds the future of owning homes as it breaks the cost barrier on construction.

“The solution to the housing problem should not be left to the government alone, modern technologies such as AI and blockchain offer practical alternatives to the crisis by aiding individuals easily build dream homes through installments,” he says.

Through a pool of software developers, Mr Nyabuto has come up with software known as Nyumba Mkononi, which links aspiring homeowners to the whole construction value chain.

The network includes companies dealing with cement, roofing and steel, tile and interior, blocks, ballast and sand providers, contractors, architects, labourers and installers.

Using advanced AI, Nyumba Mkononi can approximate the number of materials needed to build a particular house and give a purchase plan right from a mobile phone.

The concept uses blockchain technology and what Nyabuto calls „distributed databases” to create visibility, tracing and a secure system that brings together partners across the construction market.

“We have created an ecosystem of interdependence and we are at the centre of it using next-generation technologies,”  he says.

“We believe that starting to construct a house on your phone by purchasing materials in most affordable units, regular reminders on targets not only activates your creative subconscious which will start generating creative ideas to achieve your goal but also programmes your brain to more readily perceive and recognise the resources you will need to achieve your dreams,” says Nyabuto.

A task force on blockchain formed by the government in 2019 said in its report that the new technology has the potential to deliver affordable housing under the Big Four Agenda.

“Previous attempts to provide affordable housing failed when the rich, through corruption, denied poor people access to the allocations of new housing,” said the task force led by Bitange Ndemo.

“This will not happen in future since the State Department of Housing has committed to using blockchain for allocation and financial management of affordable housing.”

 “Blockchain in combination with AI will lower transaction costs through smart contracts,” it added.

According to a 2015 World Economic Forum survey of 800 executives and information and communications technology sector experts, 57.9 per cent of the respondents believe that 10 per cent of the global GDP information will be stored on blockchain technology by 2025.

“Until recently, blockchain was known more as the technology powering Bitcoin,” says Deloitte in a report on blockchain in commercial real estate.

“The industry players now realise that blockchain-based smart contracts can play a much larger role in commercial real estate (CRE), potentially transforming core CRE operations such as property transactions (purchase, sale, financing, leasing, and management).”

Fredrick Obura


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