“My primary occupation was to give every citizen a stake in the country and its future. I wanted a home-owing society. I had seen the contrast between the blocks of low cost rental apartments badly misused and poorly maintained and those of house proud owners”

Lee Kuan Yew

Prime Minister Singapore 1959 – 1990

We shall get to the essence of that quotation at the end of this piece of writing. Keep it at the back of your mind, will you?

Stability in the future is about coming face to face with grim realities in the present and devising remedial measures to offset potential strains in the days to come. A lot has been said about the housing market in Kenya especially the nexus of booming prices, an acute housing shortage and run-away mortgage rates that lock many out of desired home ownership.

In the urban centers such as Nairobi, Kisumu, Mombasa and Eldoret, there is every indication that decent housing supported by the requisite infrastructure such as sewerage, electricity connection et cetera remains a mirage to many dwellers. In the worst case scenario, the face of destitution remains a characteristic in major towns with tens upon tens of street families braving the vagaries of the weather to find a home in the streets and alleys of central business districts – beggars by day, survivors by night.

Exactly what are we staring at in view of the state of housing in Kenya? This is the question that we, as a nation and more so as policy makers, must venture to answer with each passing day that ushers us into the undefined future. I propose one metric by which this can be considered.

Kenya’s 15 – 64 Years as Percentage of Total Population

Kenya’s 15 – 64 Years as Percentage of Total Population

Source: Business Monitor International Statistics 2014

The age bracket 15 to 64 years is considerable for one important fact. It reasonably marks the bracket in which many become economically active and productive (15 to 20 years) and closes at the age in which many in Kenya would be retiring from formal employment and, in most instances, relocating to rural areas (55 to 65 years). It is in  this age bracket (15 – 64 years) that many find themselves living in urban centers either as employed or self-employed and where housing becomes a key consideration.

In 1990, 48.3% of Kenya’s population was in the age bracket 15 to 64 years. By 2005, this proportion of the total population had grown to 54.5%. This indicates that the age bracket that would widely be deemed economically productive and creating a rising pressure for housing in urban centers has been on an upward trend. This explains why an estimated 50% of Kenya’s urban population lives in “very poor neigbourhoods”[1] (I presume that is the government’s euphemism for informal settlements). Growing demand has far outstripped supply for housing in Kenya. Official available statistics indicate that the country generates a paltry 20,000 to 30,000 housing units per annum against a demand of about 150,000 units. This occasions a deficit of about 120,000 to 130,000 units per annum.[2]

Two areas beg urgent and speedy attention as we begin contemplating the possible implications of unchecked housing deficit in the country – the increased provision of low cost urban housing and the upgrading of slums and informal settlements. The Kenya National Housing Policy 2004 defines urban low cost housing as “housing comprising a minimum of two habitable rooms, a cooking area, sanitary facilities, covering a minimum gross floor area of 40 square meters for each household”. A decade since the drafting of the policy, affordable low cost housing remains an unreachable dream for many as mortgage lending rates continue to be punitively high and income levels plummet in the face of a rising cost of living.

It is projected that by 2035, the proportion of Kenyans aged between 15 and 64 years will have reached the 60% mark. This calls for a reconsideration of the country’s preparedness to meet the challenges that come with a morph in this age bracket even as it whets its appetite to reap from a growing pool of economically active persons who should increase the economy’s productivity.

Affordability and access to housing remains the bone of contention as we contemplate the state of housing in the economy. Going hand-in-hand with this economic challenge is the crisis of massive unemployment and low wages that inhibit both savings and investments. The hazards associated with failure to address these bear grave implications – a people frustrated by inability to provide, arguably, the first of basic needs and resorting to social disorder to vent the frustration.

Be that as it may, on matters pertaining housing in an economy, no target supersedes home ownership and the long-term focus should be the scaling down of mortgage lending rates.

[Image Credit: Nation]