Do you own the house you are living in – or are you renting it? Let’s go with the majority – the tenants. What proportion of your takeaway monthly salary goes into servicing your monthly rent, and by extension paying your bills? An economist friend once told me that you should strive to ensure that your rent never takes more than a third of your monthly net income. Let’s proceed with the questions. Is the rent matching the neighbourhood or the community that you are living in?

Maybe you are part of Nairobi’s demographic group that lives in a high rental apartment because you can afford it. On the other hand, you could be living in a 1-bedroom extension because you have no option.

What comes to mind when someone says he or she plans to put up affordable housing units? Is it that they are using the NHC’s Styrofoam EPS panels? Or is it because they are using reinforced concrete panels? Or are they saying that because they are planning to use the common interlocking clay blocks? Or is it because he or she has a lot of money – so much money that they can buy any house they want?

In Kenya, there needs to be clear information regarding housing affordability when it comes to the provision of housing. There are various angles or perspectives to this discussion.

Angle 1 – Affordability

Affordability is a relative term when it comes to purchasing anything. It is essentially your ability to pay for something. Affordability in the context of housing gets complicated by factors such as varying preferences arising from the location of the building to the quality of finishes and fittings in the house. Social expectations also have an influence such as: Why build a house made of Styrofoam EPS panels in the heart of Muthaiga? Why put up a replica of Magnolia House 12 in the middle of Kathonzweni?

We cannot have a discussion about affordability without discussing financing. Whether you are planning to take a mortgage, to build, rent or buy, it is your financial capabilities that will dictate the quality of housing you can reside in. Typically, the common mwananchi investor would grab a copy of the quarterly Institute of Quantity Surveyors of Kenya ( IQSK )magazine – if you are lucky enough to come across a recent one – and flip to the sections indicating the average cost of putting up houses in the three main regions of Kenya. When you look at ‘low cost, low rise flats’, you will see that it costs approximately Ksh 32,000 per square metre, excluding VAT. When you factor VAT, it will cost you an average of Ksh 37,120 per square metre. Alternatively, you’ll pick up your phone and call a QS, asking for the same information.

quarterly IQSK Magazine

The Quarterly IQSK Magazine [Vol 016, Issue 004]

Let us assume a 100 square metre ‘affordable’ unit in such a development. Going by the data accessible to you, a layman, it will cost approximately Kshs 3,712,000 to put up the unit. The developer, after factoring in all the administrative and land costs will sell it at say Kshs 5.5 million. Let’s go to the Housing Finance mortgage calculator and assume a mortgage loan rate of 16% and a repayment period of 15 years. Your monthly mortgage repayment period will be Kshs 80,779 per month for the next 15 years. Remember, this is what a layman would do. Calculate that over the 15 years: Kshs 14,540,220.

Brilliant applicants for mortgage would quickly engage the services of an accountant familiar with taxes and associated incentives tied to mortgage repayments such as relief and deductions of interest paid on the mortgage. This is capped at a maximum of Kshs 12, 500 per month.

Whereas the value of the property will be growing over the years, the typical Kenyan investor ( the landlord culture) would look at it from this perspective: Can I rent this house such that I get a monthly rental income that will eventually cushion me from the high monthly repayment? If I can, then I will move out and rent a cheaper house, and pocket the difference. Maybe this could be a good explanation why your rent is unusually high especially when your landlord has bought it through mortgage financing and they want to maximize their rental income in a bid to reduce their monthly repayment. Just maybe.

Angle 2 – Quality of Finishes

Finishes have a big effect on the affordability of a housing unit. If our example was to be furnished to the standards of a luxury apartment in Kilimani, then the price will no longer be the same. This applies to the quality of mechanical and electrical installations in such a building. There’s no clearly defined line on where affordability starts and ends. To some buyers, a parquet floor finish would be a basic finish and porcelain tiles more desirable – if they can afford it. Ever heard of property buyers who acquire an expensive, fully finished or equipped property only to strip it completely of their finishes and then fix finishes that are preferable to them? Or have you come across buyers who have approached a developer offering to buy the shell of the house and which they will finish themselves? My point exactly.

Fitted designer kitchen

Fitted designer kitchen

Angle 3 – Cost of Land

The land factor is almost everything – it cannot be ignored. Usually, this goes hand in hand with its location. The cost of land is rising in areas experiencing high demand for housing for one reason or the other. Serviced land with access to road piped water and electricity come to mind. Such parcels have either been taken up already or they are expensive. By the time such parcels are released into the market, a lot of time and opportunities will have elapsed. One way of making housing affordable is to increase the supply of land that is desirable to developers by providing water, access roads and other amenities and infrastructure.

Nairobi land prices

Nairobi land Prices as reported by HassConsult in February, 2015

In view of the revelations that shocked most of us about the astronomically high land prices in Nairobi, we should probably ask ourselves: How have the zoning rules led to the rise in prices? Are ‘houses expensive because land is expensive’? Or is ‘housing is expensive because of artificial limits on construction created by the regulation of new housing’?

Angle 4 – Materials

I am sure you have gone to the home expos and exhibitions and walked into stands exhibiting interlocking blocks and bricks. Or you have been stopped by a particular company’s sales representatives to sample some of their top-notch technologies targetting affordable houses. These are excellent alternatives to the traditional, common building stones. It may be faster to build with them, hence saving you on interest payable on the loan you might have taken out. But before you use them always ask yourself a few questions:  How many fundis do you know that can use the technology as prescribed by the producers? How easy is it to access these materials locally?

In case you wanted to put up a shelter using this technology in your upcountry home, where would you get the expertise from? If you import the technicians from Nairobi, you can work out the costs of hosting them in the countryside. Otherwise, you will be left at the mercies of fundis who are neither trained nor fully exposed to the emerging housing solutions. Wouldn’t the best alternative be using materials and skills locally available to you?

Construction technology can only translate into real savings if put to use effectively and efficiently in coming up with a housing unit.

Angle 5 – Approvals

One of my former landlords mentioned to me that their organization based in Kilimani area of Nairobi was trying to set up additional office space within their complex. However, they were shocked when they reached the approval phase of development. The Nairobi City County (NCC), allegedly, refused to authorize the development due to the unfamiliar technologies. It brings out one question regarding how our laws and by-laws: Are they evolving to meet the emerging needs and addressing the new technologies? Most of the developments that seek to employ faster methods of construction are based outside the confines of the city and most urban areas.

Picture a gated community development in the heart of Runda with identical designs. Type A has its walls made of masonry walling. Type B has its walling made of interlocking clay blocks. The rest of the details are completely the same. Which one do you think would be more affordable for you? Why?


Housing affordability is a function of many things, hence a complex subject. Remember, the opposite of expensive is cheap, not affordable.