How Kenya's informal workers hold the key to unlocking the housing market

If population is used as the basis for estimating Kenya’s housing demand - which has always been the case with the government - the potential market is undoubtedly vast.

But once this population is broken down into effective demand, it shrinks. It dwindles even further when qualified demand becomes the criterion.

Kenya’s housing shortage is estimated at two million units. Successive regimes have not been able to crack this demand, even with the current 1.5 per cent housing levy imposed on workers.

There is, however, a way, according to Thierno-Habib Hann, Shelter Afrique Development Bank Group managing director and chief executive.

Hann argues alternative underwriting of mortgages can stimulate effective demand to qualified demand. He says the same has been done in other countries, such as India.

It is the same strategy that has been used to facilitate banks to lend to small and medium enterprises (SMEs), which for long were considered unbankable.