How Poor Land Quality Is Slowing Housing Development in Kenya

Kenya’s drive to build two million affordable homes continues to be held back by high land costs and limited infrastructure.

At the Kenya Mortgage Refinance Company (KMRC) Affordable Housing Conference, industry leaders said land prices remain a major factor in pushing up the cost of new units. They noted that developers are often required to install basic services such as water, sewerage, and roads on construction sites, with these expenses ultimately passed on to buyers. 

Chris Chege of Shelter Afrique Development Bank questioned why developers must fund infrastructure that could be provided through public investment or concessional arrangements. KMRC Chief Executive Johnstone Oltetia offered a different view, arguing that areas without existing services could help reduce overall housing costs. 

He said that if land and infrastructure account for about 40 per cent of a unit’s value, removing these costs could make homes more affordable. His comments highlighted the ongoing debate over whether infrastructure should be built before housing or introduced after construction. 

In many cases, homes in Kenya are completed long before essential services arrive, leading to estates that are expensive yet poorly served. Rising demand is adding further pressure. With urbanisation growing at 4.3 percent each year, competition for land in both central and outlying areas is increasing. 

A widespread preference for building rather than buying homes has also contributed to fragmented land ownership, complicating large-scale infrastructure provision. HFC Bank Managing Director Peter Mugeni said gated communities, where land is consolidated under a single master plan, are far easier to service. 

His institution has begun purchasing large parcels, subdividing them, and offering pre-designed housing plans to balance individual choice with planned development. The lack of comprehensive master plans has left many estates facing persistent challenges with sanitation, amenities, and construction standards. 

Analysts warn that without coordinated planning, the government risks meeting its housing targets without ensuring suitable living conditions. Digitising land records is seen as a key part of the solution. 

Rwanda, often cited as a regional model, has automated its land registry and introduced pre-approved housing plans, speeding up approvals. Lucy Owano of FSD Kenya said Kenya’s progress has been uneven, explaining that while the national Ardhi Sasa platform has advanced digitisation, many counties still rely on manual systems. 

Lands Cabinet Secretary Alice Wahome acknowledged that Kenya trails several African countries in land record automation and noted Rwanda’s early partnership with the World Bank as a factor in its progress.