Housing Finance in Kenya


CAHF has partnered with FSD Kenya in support of its Affordable Housing Project, which was launched in 2020 as part of a broader process to develop a coordinated and collaborative FSD Network Strategy for Affordable Housing in Kenya. The joint strategy, encompassing FSD KenyaFSD Africa and FSD Africa Investments (FSDAi), was developed with the support of CAHF, and FSD Kenya has used this collaborative Strategy as a foundation from which it has designed its Affordable Housing Project. In November 2020, the Programme Investment Committee agreed on a three-year grant programme to support the implementation of the Affordable Housing Project, and CAHF is a strategic collaborator for FSD Kenya in implementing this project.
Visit our ONLINE PORTAL for links to relevant literature & reports on Kenya
To download a PDF version of the full 2022 Kenya country profile, click here.
Affordable Housing and Housing Finance in Kenya

Kenya has the most populated nation in the East African Community and the greatest economy in East Africa. It also holds the position of being the second most populous in the EAC. The GDP of Kenya in 2021 was Ksh12.098 trillion, which is equivalent to $102.6 billion in US dollars, and the economy expanded by 7.5%.

As of December 2021, Kenya had 38 commercial banks, with 32 offering residential mortgages. The value of residential mortgage loans was Ksh245.1 billion (US$2.08 billion), out of which 11.6% were non-performing loans. The Monetary Policy Committee raised the central bank rate from 7.5% to 8.25% in September 2022. Kenya’s National Treasury also offers risk-free government securities through Treasury bills and bonds.

The high costs of development-class land and buildings are the main problems making affordable housing unattainable for low-income Kenyans. The cost of land in Nairobi’s satellite towns ranges from Ksh9.8 million (US$83,149) per acre in Kiserian to Ksh27.1 million in Ngong. One-bedroom flats in Ngara/Pangani rent for Ksh25,000 (US$212) per month, including service fees. Continued urbanisation has resulted in a rise in the cost of land in Nairobi and surrounding regions, impeding the creation of affordable homes.

Residential housing trends to watch include student housing and tenant-purchase schemes, where a tenant pays rent over a period and eventually owns the unit outright. There has also been growth in off-grid lighting and energy solutions. Ten million people rely on quality-verified off-grid solar products for lighting, but more green technologies and solutions, especially for water and sanitation services, are needed.

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 2022 edition, which has up-to-date profiles for 55 African countries.

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