Cytonn to raise Sh30b for housing

Cytonn Chief Executive Edwin Dande

Investment firm Cytonn plans to pump more than Sh30 billion into the government’s affordable housing plan.

The firm targets to set up at least 6,000 units from the funds raised by its new savings product, Cytonn High Yield Fund (CHYF).

Cytonn Chief Executive Edwin Dande said the CHYF targets to raise at least Sh30 billion from individuals where it would later be deployed to the affordable housing programme.

He said Kenyans could activate their accounts with at least Sh1 million from which they could expect a 15 per cent return on investment.

“Legally, though one cannot invest more than 25 per cent of earnings into one asset class, CHYF, courtesy of the friendly regulators, has an exemption to invest more than 80 per cent of the funds into real estate,” Mr Dande said. 

He said the areas targeted for the new projects include Ruai and Ruiru as well as Athi River.

The houses, he said, will cost not more than Sh3 million once complete. 

Incentives

Housing and Urban Development Permanent Secretary Charles Hinga said the State had a lined up a host of incentives for it to be able to deliver its promise to more than 200,000 Kenyans in need of decent and affordable housing each year.

“The ministry has spent the last 20 months coming up with better investment guidelines together with various incentives to facilitate the affordable housing agenda,” he said.

Mr Hinga said the private sector was welcome to take advantage of various tax incentives such as VAT, withholding and railway development levy that have since been removed from materials aimed at providing affordable housing.

“Other tax incentives include the home ownership savings plan as well as the affordable housing relief,” he said.

The chairman of East African Forum for Alternative Investments, Edward Odundo said collective investment schemes like Cytonn’s were the way for the majority of Kenyans who cannot afford mortgages.