Affordable Housing Bill

Understanding Kenya Affordable Housing Bill 2024

The controversial affordable housing bill is back on the airwaves again. In 2023, the high court declared the housing bill unconstitutional, dealing a big blow to the ruling government.

The Affordable Housing Bill 2024 was re-introduced again in parliament after the courts ruled the bill as institutional two consecutive times. The bill passed the second reading after 141 MPs voted to proceed with the bill. Only 58 MPs voted against the bill.

The bill was slated for the third on Wednesday, February 22, 2024, and it sailed through. MPs from the opposition were seen furiously storming out of the parliament after the bill was passed.

The housing bill will now be forwarded to the Senate. The government plans to sail the bill as soon as possible and start deducting the March 2024 salaries.

Kenya Affordable Housing Bill

The Kenya Affordable Housing Bill was introduced in 2023 to provide affordable housing to the general population.

According to the Housing Bill Act, affordable housing should not cost more than 30% of the total income of the tenant renting the house.

To actualize the housing project, employed citizens will be deducted a levy fee of 1.5% of their gross salary. Additionally, employers will also remit 1.5% to their employees, making the total collection 3%.

For instance, if an employee earns Ksh 100,000 per month, 1.5% of the gross salary will be deducted from Ksh 1,500. The employer will also be deducted Ksh 1,500, making the total deductions to Ksh 3,000 per month.

Understanding Kenya Affordable Housing 2024

The government will establish an affordable housing fund to manage the affordable housing projects by doing the following:

  1. Facilitate funds for affordable housing schemes
  2. Provide low-interest loans to people who want to purchase the housing units
  3. Facilitate the construction of housing units in all counties
  4. Develop reliable and flexible finance solutions for the off-take of housing units
  5. Provide funds to maintain the housing units
Affordable Housing Bill

The board shall also allocate the following funds:

  • 30% to the National Housing Corporation
  • 30% to slum upgrading, rehabilitation, off-take, and maintenance of the affordable housing units
  • 36% to the state department dealing with affordable housing
  • 2% to the collector of the housing levy
  • 2% to the board of the housing fund

An affordable housing board will also be established which will be made up of the following:

  1. Non-executive chairperson (president appointee)
  2. National Treasury Principal Secretary
  3. Principal Secretary for the Housing State Department
  4. Three people to be appointed by the CS (cabinet secretary) one from the Council of County Governors, One from the trade union, and another one from FKE (Federation of Kenya Employers)
  5. Three non-public servants with qualifications in law, finance, or built environment. They will be appointed by the CS
  6. Chief executive officer who can’t vote at the board meeting

All the board members will be required to meet chapter six of the constitution

To qualify for the affordable housing unit, a person should be a Kenyan citizen over 18 years of age. Any eligible Kenyan can request a loan to purchase an affordable housing unit. All they have to do is make an application to the concerned agency.

What next for the Affordable Housing Bill 2024? When the bill sails through the Senate, employed Kenyans and employers will be deducted the 1.5% housing levy. What the opposition MPs wanted was the slash of the 1.5% housing levy which affects most of the ordinary Kenyans.

Dr Amollo, the Rarieda MP has this to say and I quote “This Bill as conceived is unclear who will benefit from this housing project and whether it is by renting or ownership. They are seeking to levy the gross salary and not the net income. The instructions that have come are to shoot clown all our proposed amendments. Therefore, the process going on is robotic and prejudged”

On the other hand, majority leader Kimani Ichung`wah emphasized how the bill creates employment for the youth, affordable homes for struggling Kenyans, and generates wealth for the country.

Conclusion

As the affordable housing bill continues to gather heat awaiting the Senate debate. Many Kenyans are at the crossroads of whether to support the bill that builds them affordable houses or to oppose it.

As of today, we will wait and see whether the bill sail through the Senate or it will be shot down.

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