Kenyans to access up to Sh4 million in loans to build rural housing units under new rules approved by Parliament, marking a significant milestone in the implementation of the Affordable Housing Act, 2024. The National Assembly’s Committee on Delegated Legislation has cleared the Affordable Housing Regulations, 2025, paving the way for operationalisation of the Affordable Housing Fund. The regulations, developed by the Ministry of Lands, Public Works, Housing and Urban Development under Cabinet Secretary Alice Wahome, will allow eligible Kenyans to borrow and develop affordable rural homes for the first time.
Under the new framework, applicants seeking loans from the Affordable Housing Fund must meet strict eligibility requirements. They must have voluntary savings with the Fund, should not already have been allocated an affordable housing unit, and must demonstrate repayment ability. Applicants will also need to submit a valid title deed, an official land search, a valuation report by a registered valuer, and a priced bill of quantities prepared by a licensed quantity surveyor. Additionally, approvals from the relevant county executive for development permission will be required before loans are processed.
Successful applicants will have their loans credited to their accounts after the Board registers a charge in its favour and requires the borrower to take out life insurance cover. The maximum loan amount available is Sh4 million, which is expected to significantly boost rural housing development. The regulations also provide for reallocation of loans in cases of default, stipulate interest rates and administrative fees, and outline procedures for allocation, off-take, and eligibility for institutional housing agreements.
The approval comes against the backdrop of the Affordable Housing Act, 2024, which introduced a 1.5 percent levy on gross salaries and incomes to finance the Fund. Employers are obligated to match the levy contributions of their employees, creating a pool of resources intended to drive Kenya’s ambitious housing programme. The regulations clarify how the levy will be administered and ensure accountability in loan allocation, offering much-needed guidance for beneficiaries and stakeholders.
Cabinet Secretary Alice Wahome hailed the move as a major step in the progressive realisation of adequate and affordable housing for Kenyans. While acknowledging that the regulations might increase the cost of business and pose challenges for financially weak enterprises, Wahome stressed that the long-term benefits outweigh the risks. She argued that the increased demand for construction services, materials, and expertise would open up job opportunities and spur growth in the real estate and allied sectors.
With Parliament’s approval, the regulations will be gazetted and implemented immediately, giving Kenyans an opportunity to access structured and affordable financing for rural housing. Policymakers hope the move will improve housing standards in rural areas, increase household asset ownership, and stimulate local economies. For ordinary Kenyans, the Sh4 million loan window represents not just an opportunity for better housing, but also a chance to build lasting wealth and stability in line with the government’s affordable housing agenda.
