The state targets to collect 10 billion per month for the affordable housing project

By Moses Muli

Published: 21 March 2024, 11:05 AM

The Kenya Kwanza government aims to collect between Sh9 billion to Sh10 billion monthly from the Housing Levy.

This is after the signing of the Affordable Housing Bill into law this week.

Speaking during an interview, Housing Principal Secretary (PS) Charles Hinga said that is the target they are anticipating.

“Before the court stopped it, we had peaked at Sh5 billion a month. Then there was a government contribution of about Sh1 billion making it between Sh6 billion to Sh6.5 billion a month,” he said.

Going forward, employees will now be deducted 1.5 per cent of their gross monthly pay, the amount that will be matched by their employer.

Under the new law, Kenyans in the informal sector and others not salaried will pay 1.5 per cent of their monthly gross earnings to fund the  housing project.

The new legislation brings in workers in the informal sector for the regulations to be in agreement with the High Court ruling that rendered it unconstitutional last year.

The PS also noted that Kenyans will no longer be required to pay a 10 per cent deposit upfront to own affordable homes.

Hinga on Tuesday said that the 10 per cent requirement was one of the major concerns raised during public participation in the Affordable Housing Bill.

“Part of this lawmaking is public participation. One of the things the committee went through was this issue of the deposit,” he said.

“Many Kenyans, everywhere said they like the programme but cannot afford the deposit. So both houses ( Senate and National Assembly) agreed that no more deposit should be required upfront to own the houses,” Hinga added.

Before, people seeking to be allocated an affordable housing unit were required to provide proof of a requisite deposit of at least 10 per cent of the value of the affordable housing unit being applied for.

Other requirements include copies of  Kenya Revenue Authority, personal identification number certificates, and individual national identity cards.

According to the government, there are 100,000 affordable housing units are under construction in various parts of the country.

During the launch of the Ministry’s Strategic Plan for 2023-27, CS  Wahome said that the affordable housing project is meant to help curb housing deficiency.

“The development will bridge the 2 million housing deficit for the growing population in urban areas,” Wahome said.