Nearly 4 out of 10 Kenyans have been unable to pay rent since the outbreak of the COVID-19 pandemic, according to a new report by the Kenya Institute of Public Policy Research and Analysis (KIPPRA). This is a more than five-fold increase from pre-pandemic figures, which showed that less than 1 in 10 Kenyans could not afford to pay rent on time.
A majority (60.8%) of households struggled with rent because of reduced incomes. One-quarter blame layoffs and business closures. More than one-third of small businesses in Kenya had closed by July 2021 because of COVID-19.
Counties that rely mostly on tourism and cross-border trade were most affected. In Mombasa and Lamu counties, Kenya’s most popular tourism destinations, more than 50% of tenants reported not being able to pay rent. And in Busia, a town bordering Uganda, nearly 60% of tenants have failed to pay rent. Those least likely to pay rent were in the low-income and low-rent brackets.
These figures are significant because a vast majority (78.7%) of Kenya’s urban population lives in rental housing, compared to 13.4% in rural areas. Tenancy rates are higher in cities and towns that are commercial hubs. Between 80% and 90% of residents in Nairobi and in commercial centres, such as Eldoret, Mombasa, Naivasha, Nakuru and Thika, are tenants, according to a World Bank survey. The majority (89.3%) of tenants in urban areas rent from individuals. The public sector accounts for only 4.7% of residential housing stock nationally.
Skewed rental market
Poor quality housing in low-income areas dominate Kenya’s rental market in urban areas; 65% of urban households live in informal settlements where they pay monthly rents of less than 10,000 Kenya shillings (roughly $100) a month. 10 million Kenyans, or about one-fifth of the country’s population, live in slums that have poor access to basic amenities such as drinking water and adequate sanitation, according to the 2019 Kenya Population and Housing Census.
Kenya’s constitution clearly states that every person has the right to “accessible and adequate housing, and to reasonable standards of sanitation.” But Kenya has struggled to provide adequate housing to its growing urban population of roughly 15 million, or about one-third of the total population. Kenya has a housing deficit of 2 million units. That continues to grow at a rate of about 200,000 a year.
The current government has tried to address the housing shortfall through an ambitious plan to known as the Big Four Agenda. It aims to deliver 500,000 low-cost housing units by 2022. The emphasis is on home ownership through public-private partnerships, rather than on rental and social housing.
But home ownership is out of reach for most urban dwellers. Proponents of affordable low-cost housing point out that many simply cannot make the mortgage repayments. KIPPRA’s analysis shows that most Kenyan households (72.8%) pay rents of below 5,000 Kenya shillings (about $50) a month. That’s below requirements to service any loan arrangement proposed by the government for low-cost housing. In fact, less than 1% of Kenyan households pay rents that exceed 20,000 (about $200) Kenya shillings a month, which is the minimum income required to qualify for a low-cost housing unit.
Rents in middle- and high-income neighbourhoods in Nairobi range from $500 to $2,500 a month. This means that the new low-cost housing units will end up catering mainly to the middle- and high-income groups.
Jared Ontita, the convener of the Just City Coalition in Nairobi, says rent control and affordable rent would be especially beneficial to those locked out of home ownership.
“In the models proposed by the government, none have approached affordable rent as a path to provision of adequate social housing. Despite available information that the majority of the urban population does not own land or have the purchasing power to buy a house or an apartment, affordable rent has not featured in the current social housing model.”
Dystopian urban nightmare
These huge disparities in the rental market underscore Kenya’s high levels of inequality. Kenya’s urban policies prioritise the middle and upper classes over the needs of lower-income groups, says a report published by the Friedrich Ebert Stiftung (FES) Kenya Office. The report’s authors argue that urban planning in Kenya has generally taken a top-down approach, quite often assisted by foreign interests and funding – for example, for big infrastructure projects, such as highways. It is usually done without the participation of low-income residents, who form most of Kenya’s urban population.
“For a large majority of Kenya’s urban residents, city life has been reduced to a dystopian nightmare manifested by limited opportunities for formal employment, a lack of decent and affordable housing, and failing or neglected infrastructure,” the report states.
The report says that city by-laws have a highly elitist and oppressive approach towards lower-income residents, such as informal traders and public transport and non-motorised transport users. “Kenyan cities are thus characterised by alarming spatial and social inequalities. Unless these fundamental issues are resolved, the never-ending class and cultural conflicts will continue to be a challenge in Kenya’s cities and towns.” FES is partnering with various urban-focused groups and researchers in Kenya to promote what it calls “just cities” that are equitable, democratic, and inclusive.
Unfortunately, the space for more equitable and inclusive urbanisation appears to be shrinking. Poverty rates are increasing, with people more focused on survival than on civic engagement. COVID-19 has reversed any gains Kenya made in reducing poverty and inequality levels. An additional 6.2 million Kenyans have been pushed into poverty, according to the KIPPRA report.
Russia’s war in Ukraine
Russia’s war in Ukraine is likely to make economic conditions a lot worse across Africa. African countries imported agricultural products worth $4 billion from Russia in 2020. Wheat accounted for nearly 90% of agricultural imports, while sunflower oil accounted for 6%. Egypt accounted for nearly half of these imports, followed by Sudan, Nigeria, Tanzania, Algeria, Kenya, and South Africa.
Rising consumer prices will affect countries that depend on imports from Russia and Ukraine, such as Nigeria, Kenya, Ghana, Rwanda, and Egypt. African countries will experience higher food prices, which will make life a lot harder for people who have yet to recover from the economic effects of COVID-19.