Commercial Bank of Africa takes stock of the Government’s Affordable Housing Program

Commercial Bank of Africa (CBA)  held its fifth Economic Forum  to take stock of the Affordable Housing pillar. Principal Secretary, State Department of Housing and Urban Development Charles Hinga was the key note speaker.

The forum touched on development within the industry such as tenant purchase scheme (TPS), joint ventures, property purchase overseas, offshore funding for development, the housing bubble, and the taxation within the industry.

“Every Kenyan has a right to decent and adequate housing with access to minimum basic services. I think the conversation that people have ran away from is how we were expected to fund those rights and freedoms. There has got to be some collective responsibility as to how we are going to fund these rights and freedoms that we have given ourselves. And so, in that process we agonised about funding model because not only was the State Department given a very ambitious program to implement, we were also not given money,” said PS Charles Hinga.

Speaking at the event, CBA Kenya Chief Executive Officer Jeremy Ngunze said the bank is keen on sparking conversation and economic thoughts on important development agendas and financial matters in the country.

“We are indeed excited to gather here today to take stock of the journey so far for the affordable housing pillar. Housing is one of the largest household expenditures and a major financial burden for many low income households. Its affordability, therefore, remains central to the welfare of many families and our society at large,” said Mr. Ngunze.

The National Government’s Affordable Housing Program (AHP) differs from other housing schemes in Kenya as it is the first comprehensive program in which the government of Kenya seeks to use private sector funding to facilitate provision of homes to Kenyans in the lower and middle-income brackets.

In the National Treasury Kshs2.8 trillion 2019/2020 Budget Estimates presented to Parliament last month, in the Budget Policy Statement, Kshs10.5 billion is to be allocated towards the Affordable Housing Initiative. This is a 61.5% increase from the Kshs6.5 billion allocated in the 2018/2019 financial year budget, which shows the national government’s commitment towards delivering affordable housing.

Mr. Ngunze added, “As CBA, we look forward to partnering with the government and the private sector on this journey. We are particularly excited about the opportunity to collaborate with the Kenya Mortgage Refinancing Company in bringing down the cost of mortgages.”

CBA Forum was launched in January 2018 and is held thrice a year with a specific topic each time moderated by a CBA staff. The forum held earlier this year focused on Achieving Growth amid fiscal imbalances: the real effects of Kenya’s debt trajectory. Other previous forums focused on Kenya’s tax structure agriculture and the manufacturing industry.

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