Housing Levy is a Tax, Not a Guarantee for a House – CS Wahome

Housing and Urban Development Cabinet Secretary Alice Wahome has clarified that contributing to the Housing Levy does not guarantee an individual a house, affirming that the deductions are a tax rather than savings.

Speaking during an interview, CS Wahome explained that the 1.5% salary deduction—matched by employers to make it 3%—functions similarly to other levies like road maintenance fees and is intended to fund the construction of affordable homes rather than directly entitle contributors to a unit.

“What you are contributing is not your savings, but a tax. A levy is a tax, just like road levy—it does not mean you own a road or a house,” Wahome stated.

This clarification comes after initial remarks by Housing PS Charles Hinga, who had earlier indicated that the levy was a form of saving, promising contributors either homeownership or a refund with interest after seven years if they did not acquire a house.

Despite the clarification, Wahome assured Kenyans that the housing allocation process under the Boma Yangu platform remains transparent. Applicants who qualify must pay a deposit—10% of the unit’s price—before proceeding with monthly rent-to-own payments.

For instance, a studio apartment costing Sh640,000 requires a Sh64,000 deposit and Sh3,900 in monthly payments, while a one-bedroom unit priced at Sh960,000 demands a Sh96,000 deposit with a Sh5,350 monthly repayment plan.

The government has already received over 550,000 applications, with 4,888 units set to be allocated in the first phase next month.

To accelerate the affordable housing initiative, the state is engaging developers through Public-Private Partnerships (PPPs). One of the largest projects, Mukuru Housing, is set to deliver 13,248 units, including bedsitters, one-bedroom, and two-bedroom apartments.

While Wahome acknowledged the possibility of refunds for those who opt out, she reiterated that the primary purpose of the Housing Levy is to facilitate nationwide home construction, not individual ownership guarantees.