The State Department of Housing and Urban Development has released a new set of regulations under the government’s Affordable Housing Program.

Under the proposed regulations, Kenyans can voluntarily contribute KSh200 per month to own a home. The National Housing Development Fund (NHDF) Regulations 2020,outlines that The National Housing Corporation (NHC) shall establish and maintain a National Housing Development Fund Account for each registered member to channel their contributions. The NHC will also determine the annual rate of return on investment for contributions made by members into the National Housing Development Fund.

The new regulations also state that NHC will process loan applications on a first come first serve basis. Loan interest under the regulations will be capped at 7 percent on a reducing balance basis under the National Housing Development Fund even though NHC may determine other rates. Members shall bear other loan costs.

In addition, the regulations will allow members to transfer their contributions to a pension scheme registered with the Retirement Benefits Authority, a registered home ownership savings plan, or to any member Registered under the National Housing Development Fund.

The new regulations set to be tabled before Parliament for adoption comes months after the directive by the President in December 2019 to the National Treasury in conjunction with the State Department of Housing and Parliament to amend provisions that required a 1.5 percent mandatory deduction on employee salaries to the Housing Levy Fund. If adopted by Parliament, the new regulations published by the Ministry of Housing in a legal notice dated 15th May 2020, will effectively revoke the Housing Fund Regulations of 2018