Corporate Development Principal Secretary Ali Noor has called on Savings and Credit Cooperative Societies to embrace the government’s affordable housing agenda to stabilize their fiscal health and help bridge the country’s housing deficit.
He said the state department of cooperatives is in talks with the Kenya Mortgage Refinance Company (KMRC) to have more SACCOS looking into building affordable housing register with the corporation in order to accelerate the housing program.
Speaking during DT Stima SACCO’s 46th Annual General Meeting, Cooperatives Development Principal Secretary Ali Noor said that there have been requests by various SACCOS willing to take up the AHP challenge but lack capacity.
DT Stima SACCO’s balance sheet is now worth 36.5 billion shillings up from 32.3 billion shillings in 2018 making the SACCO the second-ranked tier 1 SACCO in the country behind Mwalimu SACCO.
SACCOs could leverage their substantial financial resources to invest in affordable housing projects across the country.
Last month, KMRC announced a Ksh. 3 billion deal with Harambee SACCO, to enable the entity to advance low-interest loans for members interested in the affordable housing program.
In the move, the government is backing Harambee Sacco to construct 1,000 affordable housing units within the next three years.
The first phase of the government’s affordable housing project already produced 228 units with the next 400 units expected to come online in June 2020 and the final phase by the end of the year.
KMRC has so far mobilized about Ksh. 40 billion worth of funds from the government and private sector institutions including international organizations. The company aims to enable banks to issue 50,000 mortgages in five years.
In 2018, Financial Sector Deepening (FSD) Kenya reported that 45.9% of housing and land purchases were financed by SACCOs while the World Bank estimates that up to 90% of the country’s housing finance is now supplied by SACCOs and housing cooperative networks.