The government has set aside Ksh50.6 billion for the Affordable Housing Programme for the 2026/27 fiscal year, continuing its push for the development of affordable housing despite lingering challenges with cost, implementation, and acceptance among the public.

Treasury Cabinet Secretary John Mbadi, in his budget statement on Thursday, June 11, 2026, indicated that the investment would be to kickstart the construction of housing units and job creation in the construction value chain, which covers materials supply, labour and other related services. He stressed that decent housing continues to be a key component of social stability and economic productivity.

“I propose Ksh143.7 billion for the Housing, Urban Development and public works sub-sectors. This package includes Ksh18.6 billion under the Kenya Urban Programme (KenUP); Ksh50.6 billion for the construction of Affordable Housing Units; Ksh20.9 billion for social housing units; Ksh20.2 billion for institutional housing; and Ksh18.2 billion for critical social and physical 128 infrastructure,” Mbadi said.

The allocation is part of a larger housing and urban development package of Ksh143.7 billion, which also includes social housing, institutional housing, urban infrastructure, informal settlement upgrading, and urban sector regulation.

The essence of the programme is the Affordable Housing Programme, which the government still sees as a cornerstone to urban renewal and employment creation.

Opposition and public criticism

Although there has been a significant rise in funding, the housing programme is still severely challenged by parts of the population, labour groups, and politicians.

The issue of the mandatory housing levy, which decreases workers’ disposable income and adds to already struggling households, is one of the primary areas of disagreement. The critics argue the levy is really a disguised tax and that the benefits are not apparent to those who pay it.

Affordability and prioritisation

Of the units being built, some of the housing schemes are not open to low-income earners; the scheme was meant to cater for them. There is also some hope that the scheme could be skewed towards the middle-income sector rather than towards genuine social housing.

Other issues that have been raised are delays with projects, issues with land acquisition in some cities and concerns about the displacement of informal settlement dwellers during redevelopment and upgrading. Transparency in procurement and contracting has also been identified as an issue that needs to be suitably monitored, where there is a need for a clearer report of the cost per unit and project timelines.

Government position

According to the administration, the housing programme is a structural reform with a long-term time frame, which seeks to solve the housing shortage in Kenya and boost economic activities. According to officials, the programme will ultimately relieve the strain on informal settlements and help to create better opportunities for living there, as well as increase the number of people who can own their own homes.

The implementation of the programme is expected to depend on aspects of affordability, efficient delivery and public trust in the process, as the programme now has billions of shillings allocated to it.