County governments’ headache of chasing after tenants unwilling to pay rent could end soon after the land on which single units stand is freed to develop low cost houses.
Old standalone single and double rooms as well as single storeyed two bedroomed houses build on land located in prime areas within major towns, will be demolished to pave way for multi-billion shilling projects that are part of President Uhuru Kenyatta’s legacy projects.
“President Kenyatta identified provision of low-cost housing units as a major delivery in his last term and our task is to ensure that realisation.
"We are working on a trio-pronged strategy to fast-track their development, ensure low prices and generate demand among working Kenyans.
“Investors will be assured of good returns while developers will promptly receive payments on completion while tenants will be yearning to take possession of the units on a tenant purchase scheme that guarantees them a first come first served basis,” said Housing Principal Secretary Charles Hinga.
Homeless for a while
While demolitions will render hundreds of people residing in the old houses homeless for a while, the High Court sitting in Nairobi a fortnight ago set a decisive precedence when it struck out a civil suit filed by 330 Starehe Estate tenants, which said that the government was under no obligation to provide them with alternative accommodation.
According to the State Department of Housing, Starehe A and B properties are among parcels of land earmarked for redevelopment together with Park Road, Muguga Green, Shauri Moyo A,B & C and Makongeni estates, all in Nairobi a well as a 55 acre parcel of land in Mavoko sub-county, Machakos.
A total of 36,840 housing units will be constructed in the first phase under a public-private partnership where local institutional investors, individuals as well as foreign investors will be invited to fund construction of the houses by known mass housing developers.
To stem overall retail costs of the units, Mr Hinga said the government is adopting an economies-of-scale approach where building materials will be sourced directly from manufacturers at ex-factory price, construction fast-tracked whereby regulatory agencies will form a multi-sectoral team to scrutinise individual projects and approve in one ‘sweep’.
On its part, the Council of Governors has suggested conducting of a county-specific housing needs’ analysis instead of a flat directive that each county facilitates development of 2,000 units, among them social and low-cost housing targeting workers who earn below Sh15,000 and between Sh15,000 to 60,000 respectively.
Social housing projects
Information from the Housing department says, Lot 1B comprises social housing projects whereby transitional housing units, development of Kibera B, C& D, Mariuini and Kiambiu bringing in 15,000 units.
Lot 1C targeting 22 counties and towns has since received positive interest from 8 county governments with another 14 county governments in advanced negotiations with the housing department which will facilitate construction of 48,000 housing units.
Lot 1D is the biggest housing project with 67,800 housing units dedicated to Nairobi’s Bahati, Maringo, Ziwani, Jericho, Lumumba, Gorofani, Bondeni and Shauri moyo estates.
The ambitious programme could see 167,640 housing units added within the next two years setting the stage for more projects set to take place in the next five years totaling a minimum of 500,0000 housing units.
All completed units will be taken over by the National Housing Development Fund that will then establish a portal where all prospective house owners will slot their details, especially income to enable the fund determine their worth and ability.
“The houses will be sold on three terms, cash, mortgage and tenant purchase schemes. Banks will maximise their development of housing products from loan lending, construction and custodial services in the delivery of affordable housing at scale,” it says.
The funding model also allays fears of the government accruing more debt as investors will directly be facilitated to sell to prospective house owners.
Kenya Refinance Mortgage Company has since been formed and has attracted seed capital from the World Bank among other donors ahead of its official launch.
While the prospects are bright, it remains to be seen how the government handles mass evictions of existing tenants as the countries suffers from a housing deficit of about 1.8 million units.