Why this is the best time to own a house

Josea Cheruiyot is the acting Head of Research and Strategy at the Kenya Mortgage Refinance Company (KMRC) whose role is ensuring that projections, policies, and planning for Kenya’s mortgage market are viable andsustainable for generations to come.

He talks to Nailantei Kenga about unlocking pathways for Kenyans to own homes. Below are excerpts.

What is the status of home ownership in Kenya?

Home ownership remains one of Kenya’s most enduring symbols of stability, progress, and personal achievement. Yet beneath the national averages lie a stark and troubling divide. Kenya Bureau of Standards reports that around 61 per cent of Kenyans own homes nationally.

But these figures mask deeper disparities. In rural areas, home ownership stands at about 86 per cent. In urban centres, however, it drops sharply to 23 per cent, and in Nairobi, only about seven per cent of residents own the homes they live in.

The numbers reveal an urban housing crisis shaped by affordability, access to finance, and rapid population growth.

Urbanisation continues at an annual rate of roughly four per cent, with an estimated 500,000 people moving into cities every year. Yet, the private sector delivers only about 50,000 housing units annually, far below the estimated demand of 250,000 units.

This persistent supply gap continues to exert upward pressure on prices, making early planning essential for aspiring homeowners.

Why is it important to approach housing holistically, and what role should the government play in infrastructure provision to keep homes affordable?

Housing must be approached holistically. Buildings alone do not create livable communities. Infrastructure, such as water, sewerage, drainage, roads, and public services, determines the quality of life.

When the cost of infrastructure is absorbed by private developers, it is inevitably passed on to buyers. Land alone can account for 30 to 40 per cent of the total cost of a home, making location one of the most influential determinants of affordability and lifestyle.

This is where the role of government becomes essential. If infrastructure provision is left solely to the private sector, housing costs rise further, placing ownership even farther out of reach for average earners.

Mortgage uptake has been lower, mainly due to the negative perception around it. How can we rewrite the mortgage narrative?

 For decades, mortgages in Kenya have carried a negative reputation. Many families lost property through variable interest rates, short-term funding models, and economic volatility. As a result, millennials and Gen X grew up associating mortgages with loss rather than opportunity. At KMRC, we are reframing this narrative, starting with language.

The institution refers to its products as home loans, distancing itself from the emotional weight mortgages once carried.

Historically, banks funded mortgages using short-term deposits that could be withdrawn at any time, creating instability.

These challenges are being addressed by introducing long-term, fixed-interest home loans. Predictable monthly repayments allow homeowners to plan confidently, even in uncertain economic climates.

Loan tenures now extend up to 25 years, significantly reducing monthly repayment burdens and aligning them with household incomes.

 What product does your institution offer to its customers that makes it unique?

One thing about KMRC is that it does not lend directly to individuals. Instead, it refinances home loans issued by banks and Sacco that meet its eligibility criteria. Financial institutions advance home loans to Kenyans, then bring those loan portfolios to KMRC for refinancing, freeing up capital so that more people can access housing finance.

The initial target market focused on low- and middle-income earners, with home loans of up to Sh4 million for households earning around Sh150,000 per month.

Today, KMRC-supported loans can amount to Sh10 million, depending on eligibility.

How can joint home loan applications and taking the first step help Kenyans climb the property ownership ladder?

Home ownership does not have to be a solo journey. Many products available allow for joint applications between spouses, parents and children, or partners, enabling households to pool incomes and improve borrowing capacity. Kenyans need to start where they can afford. Areas such as Kitengela or Riara can serve as stepping stones.

The first home is not the final destination; it is the foundation upon which future mobility and equity are built.

How can Kenya make home ownership more accessible to informal sector workers?

Nationally, according to the Kenya Bureau of Standards, Kenyans spend about 38 per cent of their income on rent or mortgage payments. International best practice recommends spending not more than 30 per cent.