•The financing comes with a loan amount of up to Sh6 million.
•The proposition will allow NCBA customers to own homes starting from 9.5 per cent interest rate with up to 25 years of repayment, and 105 per cent financing.
Image: John Kamau
NCBA bank has rolled out an affordable housing mortgage offering in partnership with the Kenya Mortgage Refinance Company(KMRC).
The acquisition initiative is aimed at enabling Kenyans to own homes at affordable interest rates.
The proposition will allow NCBA customers to own homes starting from 9.5 per cent interest rate with up to 25 years repayment, and 105 per cent financing.
The financing comes with a loan amount of up to Sh6 million.
The mortgage loan will be used to acquire new homes or to construct for residential purposes, in major towns across the country.
This proposition will be available to individuals who earn a gross income of Sh150,000 and below, making it a property finance solution for the mass market.
Under the proposition, couples will also have the option to combine incomes as long as they are within the Sh150,000 threshold.
The 105 per cent financing offered reduces the down payment required in traditional mortgages, where customers will get additional financing for the legal and stamp duty fees.
In a statement on Thursday, the lender noted that the affordable housing initiative is aligned with the government’s commitment to delivering a series of ambitious social programmes, to promote long-term economic development, and is open to all Kenyans- employed and in business.
NCBA Group Director Retail Banking , Tirus Mwithiga, said the initiative seeks to address the current housing challenges being experienced in the country.
“Historically, the property sector has targeted upper-income segment of the market. However, as a bank, we are working in partnership with other organisations such as the Kenya MortgageRefinance Company (KMRC) and like-minded real estate developers to make homeownership accessible to more market segments,” said Mwithiga.
The bank's property financing team will hold monthly webinars to raise awareness on the concept, Mwithiga said.
In addition, the lender plans to utilise partnerships with developers, among them Unity Homes, Zima Homes and Maisha Development, to drive the initiative.
In line with KMRC’s strategic focus of providing fixed rate, long-term funds to catalyze the growth of home loans, it is committed to working with NCBA and provide all the support that the bank needs, KMRC head of creditat Geofrey Mwaura said.
"Ultimately, we expect more Kenyans to access these affordable home loans being rolled out. Homeownership dignifies our communities and provides opportunities for individuals and families to build wealth over time," he said.
According to a report by Kenya Property Developers Association (KPDA), it is estimated that the current housing deficit stands at 2 million houses, with nearly 61 per cent of urban households living in slums.
This deficit continues to rise due to fundamental constraints on both the demand and supply side and is exacerbated by an urbanization rate of 4.2 per cent, equivalent to 0.5 million new city dwellers every year.
NCBA Bank property loans cover purchase of plots, single residential or commercial units, purchase of multiple residential or commercial units, purchase of office blocks, Go Downs or light industrial property.
It has partnerships with quantity surveyors, valuers, furniture shops, house fittings dealers among others, who will provide support to prospective clients as additional services that come with mortgages.