Housing Development Fund- get smart fast

Charles Hinga, PS Housing and Urban Development (brilliant guy this one) was on K24 to demystify the above subject. For those who missed summary ndio hii;

  1. mainly focusing on formal employees,informal ones can join on a voluntary basis.
  2. people categorized according to income,those earning up to 15000 ksh go into social housing, basic 1-3 roomed houses, they rent to own over 25 yrs.
    Btn 15,000- 50,000/100,000(not clear which) will be accorded affordable houses (below 3 million) . interest rates at btn 5% and 10% ( I think it rises with income).
    Those earning over 100k will benefit from fixed commercial mortgage rates of about 10%. They can also use contributions as deposit for mortgage.
  3. How do you benefit?
    You must be a contributor, there is a portal where you register and is allocated a raffle number which is weighted based on different aspects such as how long have you contributed, do you have a family etc. If you miss out on lottery you are awarded additional weighting giving you a higher chance each time.
    4)what if I don’t get a house?
    You can elect a beneficiary such as your child or transfer the funds to your retirement fund.

5)what is the rate of return on my money?
will depend on performance of the fund. What is the rate of return on NSSF? you contribute but don’t bother checking rate of return, so why bother about this one? hehe
6) Will the houses be up to standard?
The houses will be built to specifications by govt . Developers will develop houses with the fund being target market. with injinia @shocks on site to certify, contractor @blackguards will not cut corners.
7)Surely,this will never see light of day right?
The first 1600 units are under construction on Park road.
8) What did Uhuru sign with UN?
Bad news, its a loan(sort of) of up to 5 billion dollars. The good news is it will enable the project to take off conferring benefits quickly (very important for such schemes). It will also involve industrial parks and infrastructure improvement to support such houses.
Now you know. Add more in case I missed anything.

I am lucky not to be formally employed. Ati lottery, in such a corrupt nation…not interested. Endeleeni kukamuliwa polepole na government officials. You will never get those houses, and even when you do, not at an affordable price. Heri kuhustle ujenge na jasho yako in peace.

Think blockchain,either way,am willing to take a chance. If county govts provide land, I think it is possible to get a 2/3 br apartment at 3m or less plus mortgage na less than 10%.

The idea is good, wacha sasa tungoje implementation

can I sub-let my social pigsty?

Thanks for this…will check it out on youtube

Why raffle? Mchezo ya pata potea ndio wanaleta kwa salary za watu? Wabadilishe iwe kitu guaranteed.

The points they won’t mention to you are the size of the units and quality of finish.
Guys will ballot for a 2bed unit @55square meters which would generally cost a developer Kes. 1.75m to construct. Open market, such a place would be sold for 4.5m to cover cost of land and profit. So minus the land, the government scheme is not offering you much of an advantage.

It’s yours so you should, you can only get one allocation per household

Not enough houses to start with, lottery takes out han involvement and resulting corruption.

in terms of size,those are specifics that will come out later. How is it not an advantage when you get a 4.5 million apartment at 2.5-3m?

too much devilish details between the lines…too much unspecified details…

I believe in capitalism except for very essential services like health and national security. Housing is not a critical service. People can build their own houses as they have always done for thousands of years. Things like housing should be left to the private sector. Otherwise, this is the newest cash cow for government officials.

True hiyo ni upuzi kabisa and kind of hurts. If am actually contributing my hard earned money I want GUARANTEED housing at a certain time.

Ministry already issued a guideline on such matters

The money collected annually cannot build a house for every family that needs one, so a process that selects who gets, who doesn’t is needed. if the bahati na sibu is done openly, then there will be a sense of fairness

The 1.5m difference is a factor of cost land, interest on the cost, opportunity cost and profit for a developer. So the advantage here is the getting the land free. Which will bring a question, who holds the lease to the land if it’s not paid for? How will financial institutions value the property after all repayments are made? Remember, the built up structure is a depreciating quantity , only the (free?) land is considered as an appreciable asset. Will you be able to borrow against that depreciated quantity on free land?

If you do an assessment of previous government and council houses, you will discover the land lease was long used to secure loans for individuals who didn’t own it.

If we had better factors of production (proper infrastructure, and better credit), our housing would be cheaper. These factors are things the government can influence.

What the government housing fund is doing is akin to treating a disease instead of preventing it.

on paper kila kitu huwa sawa.

Not when it is 55 square metres it isn’t!! who wants to live in a shoe box?

Very good summary… thanks

The devil is in the details.