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NHC Bets on Low Cost Housing Market; to Build 11,000 Homes
The one bedroom apartments will be sold for as low as Sh2 million.
The National Housing Corporation (NHC) has shifted its focus to the affordable housing market, which is short of hundreds of thousands of homes, as the state-owned firm targets low-income earners.
NHC has announced an ambitious plan to build 11,000 low-cost houses along Nairobi’s Thika Road and in Mombasa, Kisumu and Eldoret.
The houses that will be sold for as low as Sh2 million will include one-bedroom apartments – a departure from the usual three to four-bedroom units in upmarket areas.
NHC managing director Wachira Njuguna said: “We are targeting individuals in the lower and middle market segments who want to access decent housing at friendly prices.”
With the Sh2 million houses, a buyer will pay Sh25,304 in monthly re-payments for 15 years based on an NHC interest rate of 13 per cent. This means workers with a gross monthly income of Sh60,000 can qualify for the home.
The corporation is currently searching for land within 20km of the Nairobi city centre to put up low-cost houses to meet growing demand from low-income workers.
“NHC wishes to purchase at least five acres of prime land for housing development in a good location situated not more than 20 kilometres from Nairobi’s Central Business District,” the firm said in a past press notice.
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NHC is also looking for joint ventures with landowners and concessionary loans from international lenders to increase smaller and more affordable housing units.
The firm will build 3,000 units along Thika Road; 1,200 units in Eldoret; 1,000 units in Kisumu; 1,800 units in Mombasa (Changamwe) and 4,000 units along Nairobi’s Mombasa Road.
The low-cost housing sector, which has been neglected by private developers, is increasingly finding favour with real estate-focused private equity funds.
“The focus is now shifting to where the real demand for housing exists and developers are also looking at unique avenues to build low-cost homes,” said James Otieno, a Nairobi property consultant.
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