Housing Finance in Kenya


For the French version of this country profile, click here.

To download a pdf version of the full 2018 Kenya country profile, click here.

Kenya is East Africa’s largest economy and a leading financial centre in the region. The country went through a politically difficult year in 2017, but notable transformations immediately followed in 2018 after President Kenyatta’s announcement that affordable housing would be one of his “Big Four” pillars, in addition to manufacturing, food security and universal health coverage.

Kenya’s economy has shown strong growth in the past few years with a GDP growth rate above 5 percent per annum for the past five years. In 2016, real GDP growth was 5.8 percent, although this declined in 2017 largely due to uncertainty caused by the political situation, the drought, and a slow-down in credit growth following the imposition of interest rate caps. Inflation has hovered around 4 percent during 2018, down considerably from 8 percent in 2017. The currency has also been stable in 2018, offering a level of economic certainty.

Kenya has an established banking sector, with formal inclusion covering over 75.3 percent of the adult population. This is a fifty percent increase in the last ten years. Savings and Credit Cooperatives (SACCOs) and housing cooperative networks play a particularly significant role in Kenya’s housing finance ecosystems, and are estimated to provide up to 90 percent of Kenya’s housing finance.

The inclusion of affordable housing as one of the four pillars of growth in the President’s “Big Four” plan has stimulated a range of policy and regulatory interventions in the housing sector.  In its 2018 Budget Review, National Treasury announced a series of legislative and administrative interventions to facilitate the achievement of these goals, including policy changes, initiatives to leverage public land for development; and the introduction of public private partnerships to expedite administrative approvals, enhance access to well-located land, and improve inter-governmental coordination.

With clear political will promoting a range of interventions to ensure its success, the future of Kenya’s affordable housing sector looks very positive. Government’s ambition is not insubstantial: the promise of 500 000 new affordable housing units by 2022 will more than double current output, such that National Treasury estimates that the real estate and construction sectors will contribute 14 percent to GDP.

Find out more information on the housing finance sector of Kenya, including key stakeholders, important policies and housing affordability:

Each year, CAHF publishes its Housing Finance in Africa Yearbook. The profile above is from the 2018 edition, which has up-to-date profiles for 54 African countries.

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