If Many Kenyans Can’t Afford Homes, Who Is Buying Them?

• Over the years, property prices have risen much faster than incomes.
• Like any other market, real estate follows demand. But more importantly, it follows people who have the financial ability to buy.
• Building a housing project requires significant capital, and developers naturally focus on markets where buyers are able to purchase.
• As we celebrate investment and growth, we must also ask whether enough is being done to make homeownership more accessible for ordinary Kenyans.

Earlier this year, I wrote an article titled ‘Why Kenya’s Real Estate Is So Expensive (And Where It Ranks)’, where I explored why owning a home feels increasingly out of reach for many Kenyans. Contrary to popular belief, Kenya isn’t necessarily the most expensive real estate market in East Africa. The bigger issue is affordability.

Over the years, property prices have risen much faster than incomes. While there are many reasons for this, including rising construction costs, high land prices and rapid urbanisation, the end result is the same: many aspiring homeowners simply don’t have the purchasing power to buy a home.

For most people, the obvious alternative is a mortgage. But even that comes with its own challenges.

According to the Central Bank of Kenya (CBK), there were just over 30,000 active mortgage accounts in the country at the end of 2024. Put into perspective, that’s in a country with a population of more than 55 million people. The average mortgage size also stood at about KSh 9 million, while mortgage interest rates remained in the double digits, making home financing unaffordable for many middle-income earners.

Simply put, Kenya is not what you would call a typical borrower’s market.

Which brings us to another question.

If many Kenyans are finding it difficult to buy homes, yet new apartment blocks, gated communities and mixed-use developments continue to come up and sell, who exactly is buying them?

The answer is not as simple as “foreign investors” or “the diaspora.”

It’s purchasing power.

READ ALSO: Can You Really Buy a House in Kenya with Less Than Ksh 5 Million?

Like any other market, real estate follows demand. But more importantly, it follows people who have the financial ability to buy.

Today, that group includes more than just local homebuyers.

It includes Kenyans living abroad, institutional investors, pension funds, SACCOs, investment groups, high-net-worth individuals and foreign investors who see Kenya as a long-term growth market.

This doesn’t mean local buyers have disappeared. They remain an important part of the market, particularly in the affordable and middle-income segments. However, buyers with greater purchasing power are increasingly influencing where developers invest and what they build.

One group that continues to shape Kenya’s property market is the diaspora.

According to the Central Bank of Kenya, diaspora remittances exceeded USD 5 billion over the 12 months to April 2026, making them one of the country’s largest sources of foreign exchange.

Of course, not all of that money goes into buying property. Much of it supports families, education, healthcare and businesses back home. But real estate remains one of the most popular long-term investments for many Kenyans living abroad.

For some, it’s about preparing for retirement. For others, it’s about building a family home or creating wealth through rental income.

There’s also the question of purchasing power.

Someone earning in US dollars, British pounds or euros may find it easier to save towards a home than someone earning and spending in Kenyan shillings. Exchange rates can work in their favour, allowing them to invest in property that may be out of reach for many local buyers.

If you’ve noticed, there are more property exhibitions taking place in cities like London, Dallas, Minneapolis and Dubai. More developments are also offering virtual site tours and dedicated diaspora sales teams. There’s a reason for that.

Developers are responding to demand.

Building a housing project requires significant capital, and developers naturally focus on markets where buyers are able to purchase.

It’s not about excluding local buyers. It’s about ensuring projects are financially viable.

At the same time, Kenya continues to face a housing deficit estimated at more than two million units. The country requires roughly 250,000 new homes every year, yet only about 50,000 are delivered annually. With demand continuing to outstrip supply, competition for quality housing remains high.

One observation from today’s market is that Kenya increasingly appears to have two housing markets.

The first is the premium segment, made up of luxury apartments, high-end gated communities and investment properties that continue to attract buyers with stronger purchasing power.

The second is the affordable and middle-income market, where demand is extremely high but supply remains limited.

Many Kenyans are still looking for homes they can realistically afford, yet developers often face the challenge of delivering affordable housing while managing rising land prices, construction costs and financing expenses.

The result is a widening affordability gap.

Not necessarily.

Investment is good for the economy.

Whether it comes from the diaspora, local investors or international buyers, investment creates jobs, supports construction, stimulates economic activity and helps finance new developments that might not otherwise happen.

The challenge is ensuring that investment and affordability grow together.

If the majority of new developments are beyond the reach of ordinary Kenyans, homeownership risks becoming increasingly difficult for the very people the housing market is meant to serve.

Perhaps the better answer is that Kenya is becoming a market where purchasing power matters more than ever.

Developers will naturally build for buyers who are ready and able to purchase. At the moment, that increasingly includes investors alongside traditional homebuyers.

That doesn’t mean the dream of homeownership is disappearing. It simply highlights the need for more affordable financing, lower construction costs, innovative housing solutions and continued investment in infrastructure that opens up new areas for development.

Kenya’s real estate market continues to attract investors, and that’s a positive sign of confidence in the country’s long-term potential.

However, the conversation shouldn’t end there.

As we celebrate investment and growth, we must also ask whether enough is being done to make homeownership more accessible for ordinary Kenyans.

After all, the success of a property market isn’t measured only by the number of developments coming up or the amount of investment flowing in. It’s also measured by how many people can realistically afford to own a home.

Perhaps that’s the conversation we should be having.

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