By David Kipkorir.
A consortium of 35 Savings and Credit Cooperative Societies (Saccos) have come up with interest free mortgages on housing loan schemes for their members.
Kimisitu Sacco, Safaricom Sacco, Habitat Housing Cooperative, and Nation Sacco started the ball rolling on the scheme dubbed Africa Tenancy Purchase Initiative.
An official of the scheme’s steering committee, David Ndegwa said about 5,000 members were expected to benefit from the scheme.
Under the scheme, credit union members pay upfront deposit of 10 per cent of the cost of a unit then pay the rest in rent instalments for up to 20 years.
The plan is intended to provide members with more flexibility in purchasing houses.
Ndegwa said he expects the introduction of Africa Tenancy Purchase Initiative to significantly improve housing affordability.
The World Bank’s private sector lending arm, International Finance Corporation will offer partial credit guarantee for the housing projects, while Co-operative Bank and Shelter Afrique will provide short-term financing to develop the units. The initiative is also supported by UN-Habitat and State Department for Housing and Urban Development.
Forthcoming projects are the Sh2 billion Sunset Boulevard phase two located in Athi River, Sh800 million Komarock Wendani Heights, Sh6 billion Karen Heights, Sh6 billion Art Stone in Juja comprising 400 apartments, and Sh22 billion Habitat Heights in Athi River made up of 5,200 units.