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Kenya Mortgage Refinance Company launches the 2nd series of Housing Conference

The Kenya Mortgage Refinance Company (KMRC) is holding a second Housing Conference to enhance awareness on the affordable housing programme and investment opportunities in the sector.

The conference which is set to close on 25th November 2022 engaged different stakeholders with the National Treasury and bankers among them.

KMRC, which offers both affordable home loans and market home loans, was incorporated on 19th April 2019 and licensed by the Central Bank of Kenya (CBK) in 2020.

Speaking during the launch, Lands, Housing and Urban Development Cabinet Secretary Zacharia Njeru stated that provision of affordable housing is a basic human right recognized by the Constitution of Kenya 2010.

He added that despite a deficit of about 200,000 units per annum, remarkable strides in addressing this gap have been made and the establishment of the KMRC was a great step to addressing demands of affordable housing

“Kenyans can now access long term fixed rate mortgages at single digit interest rate through financial institutions and KMRC has already refinanced home loans of over Sh7 billion which is an achievement since it started 2 years ago,” said Njeru.

The CS noted that there is a need to leverage on technology and continuously innovate it to significantly scale up construction of affordable housing.

“The intention is to resolve more profound housing problems among the middle to the low income segment of urban society which is disproportionately affected by housing shortage,” he stated.

Njeru pointed out that on November 4, 2022, the Ministry listed 59 areas set to benefit from the government affordable housing programme.

He added that to address the challenges and ensure delivery of affordable housing, the Ministry will work to ensure accountability, transparency and efficiency in land administration and management, emphasize the digitalization on the Ministry’s reforms agenda, and support the adoption of the National building Code 2022.

The CS assured that the Ministry will continuously improve the code to include green and more sustainable housing to simplify the cost and approval to deliver affordable housing.

He added that the Ministry is aligning tax policies with affordable housing agenda to deliver long term investment and will partner with private sector and county government in developing affordable houses.

“We will take every endeavor to make sure the Ministry’s strategic plan, which was launched in 2020, continues to guide our operations in land registration processes and resource mobilization so that we can address the needs of our citizens,” Njeru maintained.

He continued that on the part of housing reforms, the government has been working on several bills that were introduced in the 12th Parliament but were yet to be passed. The bills include Housing Bill 2021, Valuers Bill 2022, National Rating Bill 2022, Land and Tenant Bill 2021 and National Disaster Risk Management Bill 2021.

“We shall work with stakeholders to have these bills finalized and introduced in 13th Parliament for enactment,” said Njeru.

At the same time, National Treasury Principal Secretary (PS) Dr. Julius Muia urged the stakeholders to take up the resolutions that would come up in the conference so that they could implement the proposals.

“It is true that for a long time, Kenya has witnessed a large increase in demand for housing and it is unfortunate we have not been able to meet the needs of those demands,” Muia said.

He urged the government and stakeholders to come up with interventions in the housing market to make it more responsive to the lower end segment.

The PS commended KMRC for extending loans in the housing sector to citizens at a rate below 10 percent which has never happened before.

“Finding opportunities for the lower income segment so that they can gain access to housing is very critical as they are the one lagging behind,” said Muia

He promised to work together with KMRC to ensure that the process of grading tax exemptions is smooth where technology is applied to reduce paper work and areas of uncertainty as soon as possible.

Muia added that the government has already been working with the World Bank which has created a programme development policy operation where they came up with proposed reforms.

“As we are formulating our policy proposals, we have considered two reforms in the housing sector which includes operationalization of the National Housing Fund and establishment of a risk sharing facility aimed at risking primary lenders,” he revealed.

Also speaking at the event, Housing and Urban Development PS Charles Hinga stated that pulling financial resources in the fund would allow the sector to offer guarantees to the investors who will provide housing to the medium and lowest segment.

“Through the National Housing Development Fund, we can provide a mechanism to pull our resources and underpin financing of house projects on a large-scale,” said Hinga.

He added that embarking on a housing agenda would stimulate economic recovery at local levels and create job opportunities.

The PS revealed that the Ministry is catalyzing development by providing land for projects in areas suitable for human settlement, development at no cost to the end buyer, providing bulk infrastructures to those areas and availing tax incentives.

In his remarks, KMRC Chief Executive Officer (CEO) Johnstone Oltetia said that most Kenyans can’t afford to spend more than Sh30,000 monthly towards owning a home therefore there is need to build synergies both on demand and supply side and work to support delivering affordable housing in our communities.

By Rita Muthoni