Housing has become the defining issue of our time since it is at the heart of the current world economic crisis. The provision of affordable housing characterises economic and political ingenuity. It is of greater political consequence than most other areas of government policies.
The government’s pledge to deliver half a million decent and affordable homes to working Kenyans by means of subsidy programmes that include credit facilities and adoption of cutting-edge innovative technologies and materials, is highly ambitious. These cost-effective measures are expected to foster production growth starting from increase in raw material output and decrease in manufacturing cost related to the real estate sector.
Real estate analysts suggest that a sustained decrease in construction costs can be registered with the facilitation of adequately planned support systems like sewers and quality road networks by the government.
The call for public capital investment in housing by the government rhymes well with the 2017 UN World Habitat theme “Housing Policies: Affordable Homes” that was celebrated on October 2, last year. “As we strive to create cities for all, an urgent action for achieving affordable homes requires a global commitment to effective and inclusive housing policies,” said Dr Joan Clos, Executive Director of the UN Human Settlements Programme in his address commemorating the day.
Ironically, despite the overwhelming demand, the provision of affordable housing continues to be at a historic low. Foreign investors like the US-based Milost Incorporated and India’s Tata Housing Development Company have subsequently seized opportunities in Kenya and have inked low and medium-cost housing construction agreements worth billions of shillings with local market players targeting the growing middle and lower-income segments of society.
The ripple effects of affordable housing are at par with building comparable market rate units. Research has shown that the supply of equitable housing tends to increase new consumer spending in moderate-income households which drives the circulation of capital inflow, generates new sources of local revenue, creates jobs and grows the economy.