Kenya housing cooperatives and the extension of affordable housing to their members in Nairobi city county

Abstract

Housing has been regarded as one of the fundamental rights of human being. Adequate housing is more than a roof over one’s head. However, the biggest challenge facing resident in Nairobi City County is lack of adequate housing particularly to low- and middle-income households. This situation has been worsening by high cost of building material, high cost of land, high cost of financing, rapid urbanization, rural–urban migration and social-economic disparity among the residents. The housing cooperative model of financing can be more cost-effective than other form of mortgage in the market because the cooperative housing corporation can access both internal and external funding from different financial institutions on behalf of its members. The main of objective of study was to examine the role of housing co-operatives in the provision of affordable housing for their members in Nairobi City County, Kenya. While the specific objectives of the study were as follows: To profile housing co-operative models to address shortage of affordable housing in Nairobi City County, to determine the influence of co-operative member participation on housing affordability in Nairobi City County, Kenya, to assess the effect of supportive environment for housing co-operatives in the context of the “current housing affordability” in Nairobi City County, Kenya and to examine the influence of co-operative housing finance on housing affordability in Nairobi City County, Kenya. The study adopted a mixed method research design employing both quantitative and qualitative approach. Simple random sampling technique was used to select the 397 members from the 35 housing co-operatives and purposive sampling technique was used to select ten housing experts as key informants. Qualitative data was analysed using content analysis technique. Quantitative data was analysed using descriptive statistics (including frequency, percentages and mean). For inferential statistics, the data was analysed using multiple regression analysis and restricted maximum likelihood. The findings revealed that limited housing cooperative model was most common among the resident of Nairobi City County, followed by multiple mortgage cooperative model and lastly continue housing cooperative model. The limited housing cooperative model accommodated most of interest of low-income household in terms of financing their land. On another objective, member participation was significant predictors of housing affordability in the housing cooperative at p < 0.05. Implying that member participation had a positive relationship with housing affordability. Further, supportive environment (policy and xv legislation, support services and collaboration and partnership) were significant predictors of housing affordability in the housing cooperative at p < 0.05, indicating that supportive environment determines the growth and success of housing cooperative in provision of affordable housing in Nairobi City County. Lastly, cooperative housing finance (members’ savings, cooperative loan, government loan and bank loan) were significant predictors of housing affordability in the housing cooperative at p < 0.05, implying that the increase of cooperative housing finance led to high affordability of the houses provided by housing cooperatives. The study concluded that housing cooperative approach is the best in provision of affordable housing particularly to low- and middle-income groups by using various housing cooperative models. The study also concluded that housing cooperative can be a game changer in housing sector if only provided supportive environment by various stakeholders to thrift. The study recommends for adoption of housing cooperative models that take into consideration diversity of their members in terms of environmental, social, economic and cultural practices. The study also recommends that housing cooperative needs to sensitize their members about the benefits of participation in housing cooperative activities. The study further recommends for reliable and affordable long-term sources of finance for housing cooperatives in order to meet the demand of housing needs for their members. Additionally, the study recommends that government agencies should provide a favourable environment for housing co-operatives to provide affordable housing to their members. These recommendations enlighten policy makers and practitioners in housing sector to engage public on designing appropriate housing policy that address the housing needs of their people.