Absa Bank Kenya has increased its financial commitment to the affordable housing sector with a new pledge of KShs 4 billion to support home loans for individuals. This represents a rise from the previous KShs 3 billion the bank had earlier allocated through a partnership with the Kenya Mortgage Refinance Company (KMRC).
The announcement was made as Kenya continues to face a growing housing crisis. The country’s housing deficit is now estimated to be over 2 million units, with an additional 200,000 homes needed every year to meet demand. However, supply is still falling behind, especially in the low- and middle-income segments, where many citizens are unable to afford formal housing.
Speaking at the inaugural IHS Affordable Housing Conference, Zaharaa Khanbhai, Absa’s East Africa Director for Commercial Property Finance, said more collaboration is needed if Kenya is to unlock its housing potential.
“If we are truly to unlock Kenya’s housing potential, we must collectively address the barriers,” she said, calling for joint efforts between the public and private sectors to drive real change in the sector.
The issue of housing is not unique to Kenya. Across East Africa, countries are facing similar challenges caused by rapid population growth, fast-paced urbanisation, and uneven economic development. These factors continue to put pressure on already overstretched housing systems.
In Kenya, while the government has introduced the Affordable Housing Programme to ease the crisis, many experts believe the financing responsibility lies largely with the private sector. Commercial banks and financial institutions are expected to play a key role in closing the housing gap.
Absa Bank Kenya said it is using the wider resources of the Absa Group to design more complex financial solutions, including funding for commercial property, hotels, and green infrastructure. This reflects a broader strategy of investing in long-term and inclusive projects that can deliver value for the community.
Despite these efforts, the bank acknowledged that the level of funding needed to fix the housing problem is far beyond what one institution can provide. Analysts believe that to truly reduce the housing deficit, there must be alignment between the government and private sector in areas such as incentives, risk-sharing, and policy execution.
Stakeholders also stress the importance of improving access to affordable mortgage options for individuals. At present, many low- and middle-income earners still find it difficult to qualify for home loans due to high interest rates, low incomes, or lack of proper documentation.
Absa’s new KShs 4 billion commitment is expected to support more individuals in accessing financing for housing under better terms. However, housing advocates are calling for more aggressive policies, including tax reliefs, land reforms, and better infrastructure planning, to make affordable housing truly achievable.
Beyond Kenya, regional banks are being urged to look at affordable housing as a viable investment, not just a social responsibility. As urban centres continue to expand across cities like Nairobi, Kampala, and Dar es Salaam, demand for low-cost housing is only expected to increase.
Many experts at the IHS Conference agreed that Africa’s housing future depends not just on funding, but on smarter planning, innovation in building technologies, and inclusive public policies.
For now, the move by Absa Bank is being seen as a positive step, but also a reminder of how much more needs to be done. The hope is that more banks and private institutions will follow suit, helping to bridge the gap between rising demand and limited supply.
