President Kenyatta launches Mortgage Refinance Company; targets increase of mortgages by 2022

President Uhuru Kenyatta speaking at the launch. (PHOTO/PSCU
President Uhuru Kenyatta (PHOTO/PSCU)

President Uhuru Kenyatta has launched the Kenya Mortgage Refinance Company(KMRC), an initiative aimed at benefiting the middle and lower income Kenyans when it comes to attainable and affordable housing. Speaking at the launch in Nairobi, he said the Mortgage Refinance Company will be expected to provide fixed rate, long term, low interests funding to primary mortgage lenders which will be passed on to home buyers.

The initiative has been supported by the World Bank and the African Development Bank, who contributed Kshs 25 billion and Kshs 10 billion respectively.

He noted that to deal with the current housing deficit, the government is making interventions in the housing sector to make it more responsive for the lower-middle income groups in the country. He said the intervention is based on the recognition that reaching the goal of adequate, safe, and affordable housing for all especially the lower income groups requires rethinking of approaches set out in the past.

He added that the Company will also benefit financial intuitions by providing a liquidity backstop and facilitate a much greater level of maturity transformation, “The scheme will enable financial institutions to better leverage their deposit base for all lending mortgage loans.”

He said the refinance company will contribute to the housing finance sector and increase the number of mortgages, “We expect the refinance company to significantly contribute to the development of the housing finance market in Kenya and help reverse the low mortgage penetration by increasing the number of mortgages from the current 26,000 to over 60,000 by 2022.”