Government fails to provide title deeds for Sh49.5 billion affordable housing sites

The Auditor General has flagged gaps in the Affordable Housing Programme after the government failed to provide land ownership documents for projects worth Sh49.5 billion.

The report warns that without these records, it remains unclear whether proper land ownership structures are in place to facilitate the issuance of titles to homeowners.

“The state department [of Housing] entered into contracts with various contractors for the construction of affordable houses across the country at a total contract sum of Sh49,456,549,086. However, land ownership documents for sites where the projects are being implemented were not provided for audit,” Auditor General Nancy Gathungu notes in a report for the year ending June 2024.

She cautions that the lack of these documents could complicate the sale of houses to the public, as sectional titles cannot be issued without the original title deeds.

The revelation adds to the mounting questions surrounding the Affordable Housing Programme (AHP), which has faced inconsistencies in targets, achievements and public trust. The contracts were signed despite previous concerns over land ownership irregularities, such as the case of Nairobi’s Jeevanjee estate.

In 2019, land belonging to the Nairobi County Government was transferred to a private developer, who then used the title deed to secure a Sh1.9 billion bank loan.

“The bank debt is to be utilised for the completion of the project development. The total banking facility is Sh1.9 billion, and Jabavu Village has drawn down Sh450 million so far against work certificates,” the developer disclosed last year.

Despite these concerns, the government says it remains on track with the programme, with the first 4,888 units set to be released this month and a total of 140,000 houses at different stages of development.

“I will be releasing 4,888 by the end of March and every quarter I will possibly be releasing between 4,000 and 5,000. In the next year, I should be having close to 140,000 houses,” Lands and Housing Cabinet Secretary Alice Wahome said in February.

However, the figures presented by Wahome conflict with those in the 2025 Budget Policy Statement (BPS), which reports that 124,000 houses are under construction. Similarly, the government has been inconsistent in reporting job creation under the AHP.

Wahome claimed that 1.12 million jobs had been generated for the 140,000 houses, with eight Kenyans working on each unit. Treasury, on the other hand, said the AHP had created over 164,000 jobs. In September 2024, the State Department of Housing reported 160,000 jobs for 100,000 housing units.

The government’s shifting narratives have fueled public scepticism, especially regarding the 1.5 per cent Housing Levy deducted from salaries since July 2023. Initially introduced as a savings plan, the levy was later converted into a tax through the Finance Act, 2023. The government now asserts that the funds are meant to facilitate infrastructure development for housing rather than directly funding home construction.

“This money is not supposed to give you a house, it’s the offtake. It’s money that is helping us build the house. After that, it’s you who pay for that house. We are not building and giving you, it’s like a tenant purchase,” Wahome said.

Kenyans seeking to purchase AHP houses will do so on long-term payment plans of up to 30 years, with different interest rates based on income levels. The lowest earners will access social housing at a 3.0 per cent interest rate, those under AHP at 5.0 per cent, while individuals earning above Sh150,000 will buy at market rates of 9.0 per cent.

Economists have criticised the AHP’s financial model, arguing that it imposes double costs on taxpayers by making them contribute to a levy and then pay market rates for houses.

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State collections

As of December 2024, the government had collected Sh88.7 billion from the Housing Levy, with Sh46 billion invested in Treasury bills instead of directly funding housing projects.

“What Kenya badly needs is not AHP but strong economic fundamentals that include low taxes and a good operating environment for businesses to thrive. The current model doesn’t solve the underlying problem of weak demand in Kenya,” Gichinga added.

The 2025 BPS revealed that out of 547,000 Kenyans registered on Boma Yangu—the platform for AHP applications—only 52,000 had saved a total of Sh2.3 billion toward homeownership. This represents a mere 0.18 per cent of the adult population. A Kenya National Bureau of Statistics (KNBS) survey for 2023/24 found that 55.5 per cent of Kenyans prefer to build their homes rather than buy, while 62.3 per cent have no concrete homeownership plans.

Among tenants aspiring to own homes, 62.6 per cent had not taken any steps toward ownership, with only 11.2 per cent saving to construct houses and 10.7 per cent saving to buy land.

Another major challenge is whether targeted beneficiaries can afford the long-term payment plans. Many are informal sector workers with unstable incomes, making them vulnerable to defaulting and potential eviction.

A Central Bank survey found that 42 per cent of Kenyan companies had fired casual workers, the primary targets of the AHP.

The government has confirmed that defaulters will be evicted from AHP houses.

Concerns have also emerged about whether the AHP will truly benefit low-income earners or be exploited by well-connected individuals.

According to the 2025 BPS, the government aims to construct 363,860 houses over the next three years, including 217,654 affordable units, 80,909 social houses, and 65,297 institutional housing units.

However, with mounting concerns over transparency, affordability, and public confidence, the programme's success remains uncertain.