Affordable housing gets Sh3.2bn boost from European bank

Kenya’s affordable housing project is receiving a major push with progress reported on key projects backed by the European Investment Bank (EIB), through its development arm, EIB Global.

In a statement on August 7, the EIB Global noted having invested €21.5 million (Sh3.2 billion) in equity financing into the International Housing Solutions (IHS) Kenya Green Housing Fund.

The funding, they said, supports the construction and acquisition of energy-efficient and affordable housing, particularly targeting low and middle-income earners.

“With housing costs rising, we are working with experts, planners and policymakers to improve living conditions, reduce energy costs and support climate-friendly urban growth," the Head of EIB Regional Hub for Eastern Africa, Edward Claessen, said.

 “At EIB Global, we combine both financing with non-financial contributions in the form of technical assistance and advisory services to implement projects with local partners like IHS.”

The bank further noted that three projects are already underway in Nairobi’s Tilisi, Garden City and Mashiara Park areas, delivering a total of 664 housing units.

They said ten more projects covering more than 2,600 units are also in the pipeline across Nairobi and Kiambu, while the flagship “Muzi Stawi” project in the Garden City precinct is almost completed.

The development, which began in January 2024, is now 90 per cent done and is expected to be finalised by October 2025 and includes over 200 one and two-bedroom apartments.

“Our investments reflect our ambition to redefine what affordable housing can be,” the IHS Managing Director, Kenya Kioi Wambaa, said.

 “We are on track to deliver about 4,000 quality, affordable green homes by 2030. Projects we undertake are not just developments but a promise to the Kenyan market that affordability and excellence can go hand in hand."

He further added that EIB Global’s investment with IHS Kenya aligns with the goals to address the critical need for affordable housing in Kenya.

"Garden City is an address that embodies modern living, and we are proud to make it accessible to more Kenyans," Wambaa said.

According to the Kenya Population and Housing Census (KPHC), more than 7 million of Kenya's approximately 12 million households live in urban areas, with most residing in informal settlements.

This, they say, leads to most of the population being unable to afford decent housing.

While significant attention has been paid to affordable housing in Kenya, only 2 per cent of officially constructed units are aimed at the lower income segment, according to a 2021 report by the Kenya Institute for Public Policy Research and Analysis.