Nairobi is known for slums and informal housing which is disregards planning and building regulations. The city is low-density shacks to multi-stories apartments and approximately 70% of Nairobi’s residents live in single-room units in informal settlements. The informal rental properties are typically overcrowded with poor services and bad infrastructure. Even with the president of Nairobi promised to prioritize affordable housing but there are big shortfalls in government capacity and failure to plan for low-income shelter. The apartments are usually made of mud or iron sheets, and structures are typically just one or two stories. Nairobi has been suffered several high-profile collapses of poorly constructed tenements. There are also aging public housing units with informal extensions and homes are a mix of shelter types houses.

Investors in Nairobi’s low-cost rental housing market can realise up to four times better returns than those selling formal mid- and high-income housing. This is based on estimating the rental yield and payback period for a unit in Mukuru (an informal settlement), as compared to the high-income area of Kilimani.5 Indeed, Nairobi’s rental market for single rooms is a significant economic subsector that generates at least US$372.2 million annually.6 Given this sector’s scale and profitability, any efforts to improve Nairobi’s shelter must engage with private providers in the city’s burgeoning informal rental market. Nairobi’s inadequate shelter and land provision are rooted in the city’s corruption, unresponsive governance, and lack of urban planning. Land development is outpacing the city’s capacity for infrastructure delivery, and the cost of land is often prohibitive, contributing to the unaffordability of housing.