The National Assembly Departmental Committee on Lands has begun scrutinizing proposed amendments to the Land Act that would significantly shorten the timelines for lenders to enforce loans and sell properties under Kenya’s Affordable Housing Programme.
The proposed changes are contained in Clauses 14 and 15 of the Business Laws (Amendment) Bill, Senate Bill No. 51 of 2024, which seeks to create a more conducive environment for doing business.
The Bill was passed by the Senate without amendments and is currently under consideration by the National Assembly.
Committee Chairperson Joash Nyamoko said lawmakers would assess whether the proposed timelines strike the right balance between promoting investment in affordable housing and protecting the rights of borrowers.
“Our duty is to ensure that any amendments to the Land Act promote investment while safeguarding the constitutional rights of Kenyans. We must interrogate whether the proposed timelines are fair, practical and in the public interest,” Nyamoko said.
Under the proposed amendments, the period before a lender can begin enforcing a loan secured by an affordable housing property would be reduced from 90 days to 45 days.
The notice period before a lender exercises the power of sale would also be reduced from 40 days to 20 days.
The proposed changes would apply exclusively to properties used for affordable housing, while the existing timelines for other categories of property would remain unchanged.
Supporters of the amendments argue that faster loan recovery processes would reduce lending risks, boost investor confidence and encourage financial institutions to provide more affordable housing financing.
They further argue that the proposed reforms could accelerate housing development and support the government’s affordable housing agenda.
However, some committee members raised concerns that the shorter timelines could increase the risk of homeowners losing their properties before they have adequate time to resolve loan defaults.
“Will reducing these statutory timelines provide sufficient protection to vulnerable borrowers who may experience temporary financial hardship?” Joseph Gitari asked.
Thaddeus Nzambia questioned whether the proposed changes could discourage home ownership if prospective buyers perceive affordable housing mortgages as carrying a higher risk of foreclosure.
Responding to the concerns, Nyamoko said the committee would carefully consider submissions from stakeholders before making its recommendations.
“We intend to hear from all affected parties, including lenders, housing developers, legal experts and consumer representatives, before presenting our report to the Departmental Committee on Trade, Industry and Cooperatives,” he said.
The committee is expected to submit its findings in accordance with Standing Order 127 before the Departmental Committee on Trade, Industry and Cooperatives compiles its final report for tabling in the National Assembly by August 13, 2026.
However, lawmakers noted that the timelines for completing the process are tight and indicated that they may seek additional time to complete their review.
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