Demystifying Affordable Housing and Home Ownership in Kenya

A Guide to the Affordable Housing Program

Owning a home in Kenya is a significant goal for many Kenyans, including those living abroad. With the Kenyan government’s Affordable Housing Program gaining traction, the dream of owning a home back home is becoming increasingly feasible. If you’re a Kenyan in the diaspora considering investing in property or buying a home in Kenya, this guide will walk you through everything you need to know.
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Understanding the Affordable Housing Program

The Affordable Housing Program (AHP) is a key initiative under Kenya’s Big Four Agenda, aimed at ensuring that low and middle – income households have access to decent and affordable housing units.

This program targets low and middle-income earners, making home ownership more accessible through various strategies.

Affordable Housing Program is financed and built by the private sector on both public land and private land in all counties in Kenya. Once the houses are built, the Housing Fund purchases the units from the private
developers and offer them for sale to those individuals who have registered in the online
portal www.bomayangu.go.ke

Key Features of the Affordable Housing Program:

Boma Yangu Platform:

Central to the Affordable Housing Program is the Boma Yangu platform (www.bomayangu.go.ke), representing a transformative initiative in Kenya’s efforts to enhance access to affordable housing. By leveraging technology and collaboration with stakeholders, the platform simplifies the housing process, promotes transparency, and empowers Kenyans, including those in the diaspora, to realize their dream of home ownership. It is a dedicated portal where Kenyans can access information about available housing projects, eligibility criteria, and even apply for units online. This platform serves as a one-stop-shop for all things related to affordable housing in Kenya.

Financing Options:

Financing a home purchase is often a concern for potential homeowners. The Affordable Housing Program collaborates with financial institutions to offer affordable mortgages and favorable terms, easing the financial burden on buyers.

One of the primary financing options for affordable housing in Kenya is through mortgages offered by participating financial institutions such as banks. These mortgages often come with subsidized interest rates, making them more affordable for qualified applicants.

The government may collaborate with banks and other financial entities to provide lower interest rates than those available in the general market. This reduction helps to lower monthly payments and overall loan costs, making home ownership more achievable. For instance, the partnership between KMRC and Stanbic Bank to offer affordable housing financing at an interest rate of 9.5%, with a repayment period of 25 years and a 105% financing or property value. For more information visit: Stanbic Affordable Housing Plan.

Quality Standards:

Homes under this program adhere to modern design and construction standards, ensuring comfort, safety, and sustainability for residents. Each housing unit is designed to meet the needs of Kenyan families across different income levels. 

The house’s construction incorporates the use of building materials which are of high-quality, durable and meet national and international standards and adhere to the proper construction methods to ensure the building can withstand environmental stresses like earthquakes and heavy rains. The building also comply with the National Building Code and other relevant local and international standards.

FAQs about Home Ownership in Kenya

1. Who is eligible for the Affordable Housing Program?

Eligibility criteria typically include being a Kenyan citizen, over 18 years old, and meeting specific income thresholds. These details are readily available on the Boma Yangu platform, providing clarity and transparency in the application process.

Eligibility to own a home from the  Affordable Housing Program in Kenya is determined based on several criteria aimed at targeting low- and middle-income earners who need affordable housing. The main eligibility criteria include:

• • Kenyan Citizenship: The applicant must be a Kenyan citizen.

• • Age: The applicant must be at least 18 years old.

• • Income Bracket: The program targets low- and middle-income earners. Specific income thresholds may be defined by the government to qualify for different categories of housing. Typically, applicants with a monthly income of between Ksh 15,000 and Ksh 149,999 are considered for the program, although these figures may vary based on specific housing projects and economic conditions.

• • Tax Compliance: Applicants must be registered with the Kenya Revenue Authority (KRA) and have a valid Personal Identification Number (PIN).They should be compliant with tax obligations.

• • National Social Security Fund (NSSF) Membership: Applicants must be registered members of the National Social Security Fund (NSSF).

Interested applicants must register on the Boma Yangu platform, which is the official online portal for the Affordable Housing Program. Registration requires providing personal details, proof of income, and other necessary documentation.
Allocation of houses may be done through a lottery system to ensure fairness and transparency.

These eligibility criteria ensure that the Affordable Housing Program in Kenya reaches those who are most in need of affordable housing solutions, promoting social equity and improving living standards for a significant portion of the population.

2. How can I apply for affordable housing from abroad?

Applying for affordable housing units in Kenya is straightforward thanks to the Boma Yangu portal. From browsing available projects to submitting applications online, this platform streamlines the entire process, making it feasible for me to participate in the housing market from anywhere in the world following these steps:

1. 1. Register on the Boma Yangu Platform: Visit the official Boma Yangu platform to create an account by providing your personal details, including your National Identification Number, Kenya Revenue Authority (KRA) PIN, and contact information. Complete your profile by ensuring all required fields are completed, and upload necessary documents such as proof of income, identification documents, and any other required paperwork.

1. 1. Select Housing Projects: Once registered, browse available housing projects on the platform to select the housing project(s) you are interested in and express your interest through the platform.

1. 1. Submit Required Documents: Submit proof of income, such as payslips or bank statements, even if they are from abroad. Show tax compliance by ensuring that you have a valid KRA PIN and are tax compliant. This can often be verified online through the KRA portal.

1. 1. National Social Security Fund (NSSF) Membership: If you are not already a member, you may need to register for NSSF. You can do this online through the NSSF website. Make sure your contributions are up to date. 

1. 1. Participate in the Lottery System: After submitting your application and documents, wait for the housing allocation process, which is often conducted through a lottery system to ensure fairness. You will receive notifications through the Boma Yangu platform or via email regarding the status of your application and any further steps.

1. 1. Financial Arrangements: Explore financing options available for the housing program. This might include mortgages or loans tailored for Kenyans living abroad. Review and arrange for payment plans as required for the selected housing project.

Keep yourself updated with any communications from the Boma Yangu platform or relevant authorities and ensure you continue to meet all necessary requirements, including maintaining your tax and NSSF contributions.
For those working or living abroad, if needed, reach out to Kenyan embassies or consulates abroad for assistance and verification of documents. Additionally, utilize online support from the Boma Yangu platform or related government agencies if you encounter any issues.
By following the steps above, you can successfully apply for affordable housing in Kenya whether you are residing abroad or in Kenya. It is crucial to maintain communication with the relevant authorities and ensure all your documentation is up to date and compliant with Kenyan regulations.

3. What are the costs associated with owning a home in Kenya?

Owning a home in Kenya through the Affordable Housing Program involves several costs that you need to be aware of. These costs include the purchase price of the home, mortgage or financing costs, and other associated fees. Here’s a breakdown of the typical costs:

Purchase Price: The cost of the house itself, which varies depending on the location, size, and type of housing unit. Affordable housing units are priced to be accessible to low- and middle-income earners, with prices often ranging from Ksh 1 million to Ksh 4 million for different types of units.
Mortgage and Financing Costs: Down Payment, typically, a down payment of about 10% to 20% of the house price is required. For example, if the house costs Ksh 2 million, the down payment might range from Ksh 200,000 to Ksh 400,000.
Mortgage Repayments, which depend on the loan amount, interest rate, and repayment period. The interest rates for affordable housing mortgages are often subsidized or lower than market rates to make them more affordable.
Mortgage Insurance. Some lenders might require mortgage insurance, which adds to the monthly cost but protects the lender in case of default.
Beyond the purchase price, additional costs may include legal fees, stamp duty, registration fees, and ongoing maintenance expenses. Understanding these costs upfront allows me to budget effectively and plan for a smooth transition into home ownership.

4. Can I secure a mortgage while living abroad?

Yes, many Kenyan banks offer mortgage products specifically designed for diaspora clients. These mortgages often feature competitive interest rates and flexible repayment terms, accommodating the unique circumstances of Kenyans living abroad and facilitating your journey towards owning a home in Kenya.

Securing a mortgage while living abroad to purchase a home under the Kenya Affordable Housing Program is feasible through banks and financial institutions that offer mortgage products specifically tailored for Kenyans living abroad, often referred to as diaspora mortgages. Stanbic Bank, under their affordable housing financing plan, lays out the processes and requirements in which one can get home financing of up to 105% based on the market value or property value. View more information on the requirements through their website.

5. What are the advantages of owning property in Kenya?

Owning property in Kenya through the Affordable Housing Program offers several advantages, both for individual homeowners and the broader community. Some of the key benefits include:

• • Affordable Pricing: The program is specifically designed to make homeownership accessible to low- and middle-income earners, with subsidized prices that are significantly lower than market rates.

• • Government Support: The program is backed by the Kenyan government, which provides incentives such as reduced interest rates on mortgages, tax reliefs, and subsidies to make housing more affordable.

• • Ownership Security: Owning a home provides long-term stability and security, reducing the risk of eviction and rent increases that come with renting.

• • Investment Opportunity: Property ownership can be a valuable investment, potentially appreciating in value over time and providing financial security.

• • Improved Living Conditions: Affordable housing units are built to meet certain quality standards, ensuring decent living conditions with proper amenities such as water, electricity, and sanitation.

• • Equity Building: As you pay off your mortgage, you build equity in your home, which can be a valuable financial asset.

• • Fixed Monthly Payments: With a fixed-rate mortgage, your monthly payments remain constant over the loan term, unlike rent, which can increase periodically.

• • Potential for Rental Income: If you decide to move, you can potentially rent out your property, generating additional income.

• • Tax Benefits: Homeowners may benefit from tax deductions on mortgage interest payments and property taxes.

By participating in Kenya’s Affordable Housing Program, homeowners not only benefit personally and financially but also contribute to the broader goals of national development, economic growth, and social stability this is because Affordable Housing projects often include the development of community amenities such as parks, schools, and healthcare facilities, enhancing the quality of life for all residents.

In conclusion, the journey towards affordable housing and home ownership in Kenya is filled with promise and opportunity. The Affordable Housing Program, coupled with resources like the Boma Yangu platform, and partnerships with financial institutions empowers you to pursue your dreams with confidence and clarity. By staying informed and leveraging available resources, you are well-equipped to make informed decisions that align with your goals and aspirations.

For those of you in the diaspora dreaming of owning a piece of Kenya, and those living in Kenya but would love to own a house, now is the time to explore the possibilities. Visit www.bomayangu.go.ke to discover more about the Affordable Housing Program and take the first step towards making your dream home a reality. Whether you’re a first-time buyer or seasoned investor, the journey to home ownership in Kenya awaits you with open arms.

Remember, with determination, knowledge, and the right resources, home ownership in Kenya is not just a dream but a tangible goal within reach. Embrace the journey, embrace the opportunity, and let’s build a brighter future together in the land we call home.

Disclaimer: This guide is intended for informational purposes only and does not constitute legal, financial, or professional advice. While every effort has been made to ensure the accuracy and completeness of the information provided, we make no guarantees and accept no liability for any errors, omissions, or actions taken based on this guide. Prospective homebuyers are encouraged to seek advice from qualified professionals and official sources before making any decisions related to the Affordable Housing Program in Kenya. – ProBuilders Kenya