in ,

10 Incentives Provided Under Cheap Housing Scheme

Housing Levy

Owning a house in Kenya is a dream and a goal for many, as it is a challenge to the majority of middle-class people in the country.

Among President Uhuru Kenyatta’s Big Four Agenda’, Housing is a priority that needs to be addressed with plans already effected on the same.

The government, therefore,  in an effort to help Kenyans achieve the dream of owning a home has come up with ways to make it come true. For instance, in a bid to help provide affordable homes, it has embarked on offering incentives.

Here is a list of 10 incentives provided under the cheap housing scheme :

1. Scrapping off Stamp Duty

This does away with the requirement that first time home buyers have to pay stamp duty that usually ranges between two and four percent of the totals cost of the house.

Under the affordable housing scheme, one will be able to buy a home with the exemption of stamp duty.

Read: Cytonn Launches Housing Savings Plan That Will Partially Exempt You From Taxation

2. Corporate Tax Reduction

The Government has reduced the corporate tax for property developers building under a minimum of 100 low-cost units.

Under this cheap housing scheme programme, the tax has been reduced by half; from 30 per cent to 15 per cent.

3. Fast Track Approvals

Projects for developers under this affordable housing scheme programme will enjoy fast-tracking of their approvals in their projects.

Additionally, property registration and access to affordable housing financial will be fast-tracked.

4. Low-Cost building technologies.

The government will play the role of facilitating and adopting new low-cost technologies and economies of scale to meet the cheap housing programme and deliver homes to Kenyans.

Examples of the types of low-cost technologies will include reinforced concrete technology, prefabricated panels, interlocking bricks, precast concrete panels, and ferrocement building technology.

5. Tenant Purchase Scheme

The tenant Purchase Scheme works in such a way that an arrangement is made with the National Housing Corporation where the home buyers are allowed to occupy the houses before paying for the full amount.

Rather, they will be able to make monthly payments through the tenant and purchaser model.

Read Also:President Kenyatta Launches Mortgage Company To Finance Affordable Housing

6. Critical Infrastructure

The government intends to use bulk infrastructure in the project sites where priority and relevance will be determined by different ministries, departments, and government agencies.

For instance, the installation of sewer lines, power, water supply, drainage areas among others will be fast-tracked.

Additionally, it is estimated that building infrastructure often takes about 25 percent of the total house cost and when passed to the buyer, makes it more expensive.

With the critical infrastructure taken care of by the sate, the cheap housing scheme will be effective and affordable to citizens.

7. Reduced Tariffs

Under the Cheap housing scheme, the inputs used for construction that will be imported will have reduced custom tariffs.

For example, the Import Declaration Fee (IDF) has been reduced from two percent to 1.5 percent.

Also, the levies under the National Environment Management Authority (NEMA) and the National Construction Authority (NCA) of 0.1 and 0.05 percent respectively have been scrapped off.

8. VAT Exemption

The Value Added Tax (VAT) on construction inputs will not be applied as the scheme allows for 16 percent exemption of goods imported for the direct and exclusive use in the construction of cheap affordable houses.

The inputs will be licensed under the Special Economic Zones (SEZ).

Read Also: Cytonn Leverages On High Yield Fund From Individual Investors To Finance Low Income Housing

9. Affordable Housing Relief

This Affordable Housing Scheme also allows workers registered under the program to be eligible for tax relief of up to Sh9,000.

Employers will have to subtract the amount from income tax before passing the remainder to the Kenya Revenue Authority (KRA).

10. Kenya Mortgage Refinance Company

The housing scheme programme aims to collaborate with private investors, with Kenya Mortage Refinance Company (KMRC) identified to lend cash to banks and SACCOs so as to offer the mortgages to low-income earners.

The mortgage interest rate will also be reduced from 13.5 percent to 9 percent.

Email your news TIPS to or WhatsApp +254708677607. You can also find us on Telegram through

Written by Mercy Auma

Passionate about human interest stories and politics. Email

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Documents Lay Bare Torture, Gruesome Murders Moi’s Political Detainees Underwent

Security Officers Attempt To Block Oburu Odinga From Accessing Kabarak VIP Dias