The government is struggling to generate enough cash from its affordable housing programme to finance the next phase of construction, despite strong demand for completed units.the Affordable Housing Board collected Ksh212.342 million from housing sales in the year to June, against a Ksh15.25 billion target, achieving just 1.4% of projected revenue.
The State attributed the shortfall to most units being sold through the Tenant Purchase Scheme (TPS), where buyers make monthly rent-to-own payments instead of upfront cash purchases.
Despite the weak collections, occupancy of completed affordable homes reached 94%, exceeding the government’s 90% target. By June, 1,836 units had been completed and handed over, while another 1,380 were 98% complete.
The government expects sales proceeds to become an increasingly important funding source as it expands construction, even as reports indicate that it nearly depleted the Housing Levy collections in the years to June 2026.
Spending on affordable, social and institutional housing and related infrastructure is projected to rise to Ksh360.1 billion in 2027/28, up from Ksh110 billion in 2026/27.
The development comes as the government raises the prices of affordable housing units, with new rates taking effect in October 2026.
The price increases come amid growing pressure on the programme’s finances, after the Parliamentary Budget Office warned that projects could stall if new developments are launched before existing ones are completed.
The PBO also reported that the government had spent nearly all of the Ksh205.7 billion collected through the Housing Levy, leaving just Ksh2.9 billion as of June 2026.the Affordable Housing Board collected Ksh212.342 million from housing sales in the year to June, against a Ksh15.25 billion target, achieving just 1.4% of projected revenue.
The State attributed the shortfall to most units being sold through the Tenant Purchase Scheme (TPS), where buyers make monthly rent-to-own payments instead of upfront cash purchases.
Despite the weak collections, occupancy of completed affordable homes reached 94%, exceeding the government’s 90% target. By June, 1,836 units had been completed and handed over, while another 1,380 were 98% complete.
The government expects sales proceeds to become an increasingly important funding source as it expands construction, even as reports indicate that it nearly depleted the Housing Levy collections in the years to June 2026.
Spending on affordable, social and institutional housing and related infrastructure is projected to rise to Ksh360.1 billion in 2027/28, up from Ksh110 billion in 2026/27.
The development comes as the government raises the prices of affordable housing units, with new rates taking effect in October 2026.
The price increases come amid growing pressure on the programme’s finances, after the Parliamentary Budget Office warned that projects could stall if new developments are launched before existing ones are completed.
