Ruto Proposes Ksh5 Million Affordable Mortgage for Kenyans Paying Housing Levy
President William Ruto has unveiled a bold plan that could revolutionize homeownership in Kenya.
During the 62nd Madaraka Day celebrations in Homa Bay, Ruto proposed a constitutional reform to allow contributors to the Housing Levy to access Ksh5 million mortgage loans.
“I am pleased to announce today that I shall be proposing to Parliament a reform to the law,” Ruto declared.
“It will allow any contributor to access an affordable home loan of Ksh5 million at a single-digit interest rate, applicable to any housing unit in the market.”
This plan targets not only first-time homeowners but also current mortgage holders struggling with high-interest loans.
Plan Offers Hope to Existing Mortgage Payers Too
Ruto explained that the low-interest loans won’t just help future buyers.
“This facility will also enable contributors to offset existing mortgages,” he added.
“It offers greater flexibility in their housing journey, allowing many to significantly ease their home financing costs.”
This move could mean financial relief for thousands of Kenyans, especially those burdened by costly mortgage plans.
Progress Already Visible: Boma Yangu and Mukuru Kwa Reuben Projects
Ruto emphasized that the government’s Affordable Housing Program is already bearing fruit.
Recently, 1,080 Kenyans received keys to new units in Mukuru Kwa Reuben, Nairobi. The residents will rent-to-own their homes over 30 years.
In Homa Bay, the president handed over 110 more units at the Boma Yangu estate, signaling active progress on the ground.
Housing Levy Now Comes with Bigger Benefits
Since March 19, 2024, employees have seen 1.5% deductions from their gross salaries towards the Housing Levy.
Employers match this amount equally.
However, the government introduced tax reliefs to ease the burden. Contributors now enjoy a 15% housing tax relief—up to Ksh108,000 annually or Ksh9,000 per month.
Additionally, starting late 2024, deductions for Housing Levy, Social Health Insurance Fund (SHIF), and post-retirement medical funds are now treated as deductible expenses.
This change reduces PAYE, leaving more cash in employees’ pockets.
The Vision: Empowering Kenyans Through Homeownership
Ruto’s proposed reform could transform the lives of millions. By making mortgages accessible and affordable, the plan aims to close the housing gap and lift financial burdens.
But as with many bold plans, Kenyans are watching. Will Parliament approve it? Will the benefits reach everyone?
Time will tell—but hope is rising.
ALSO READ: Raila Sparks New Debate: Affordable Housing Must Be County-Run
Ruto Proposes Ksh5 Million Affordable Mortgage for Kenyans Paying Housing Levy
