Kisumu is increasingly attracting the attention of banks, developers and property investors as lenders intensify competition for Kenya's housing market beyond Nairobi, with affordable mortgage products and higher financing limits becoming key selling points.
The latest push came from NCBA, which held its first Property Investment Tour in Kisumu, signalling growing confidence in the lakeside city's real estate market.
The bank says the city is benefiting from expanding infrastructure, improved regional air connectivity, population growth and increased investment in retail, hospitality and education, factors that continue to drive housing demand.
According to a 2022 Kenya Mortgage Refinance Company (KMRC) report, homeownership in Kisumu stood at about 57.8 per cent, leaving roughly 42.2 per cent of urban households living in rental housing, highlighting the potential for mortgage growth.
Dennis Njau, NCBA's Group Director for Retail Banking, said the lender wants to make property ownership more accessible outside the capital.
"We believe homeownership is a powerful catalyst for financial security, wealth creation and long-term prosperity. The Kisumu Property Investment Tour reflects our commitment to equipping Kenyans with the knowledge, trusted partnerships and innovative financing solutions they need to make informed property investment decisions with confidence," he remarked.
The event showcased residential developments including Anderson Park, Jamii Jua, NHC Kanyakwar and California Gardens while connecting buyers with developers, valuers, lawyers and mortgage specialists.
However, NCBA is not alone. Kenya's mortgage market has entered a new phase of competition, with major lenders rolling out aggressive offers as they seek to unlock homeownership beyond Nairobi, particularly in fast-growing cities such as Kisumu, Nakuru, Eldoret and Mombasa.
KCB has launched a fixed-rate mortgage campaign offering loans from 8.9 per cent, financing of up to 105 per cent of a property's value and repayment periods of up to 25 years.
NCBA is marketing KMRC-backed Affordable Housing mortgages at a fixed 9.5 per cent, alongside financing of up to 105 per cent for eligible buyers, plot financing, construction loans and equity release products.
Other lenders have also stepped up competition. Stanbic has offered KMRC-backed affordable housing mortgages from 8.99 per cent, while Absa continues to market mortgages with financing of up to 110 per cent of a property's value for qualifying customers.
The increased competition comes as banks attempt to grow a mortgage market that remains relatively small despite rising urbanisation and demand for quality housing.
KMRC data shows KCB remains Kenya's largest mortgage lender, followed by Stanbic, HF, NCBA, Standard Chartered, Absa and Co-operative Bank.
For prospective homeowners, the competition is translating into lower promotional interest rates, higher financing limits and more flexible repayment options than were available just a few years ago.
Analysts say this could encourage more middle-income earners and Kenyans in the diaspora to consider buying homes outside Nairobi, where property prices remain comparatively affordable.
Kisumu appears to be among the biggest beneficiaries of this shift. As developers continue launching new housing projects and lenders expand their presence in the region, the city is positioning itself not only as Western Kenya's commercial capital but also as one of the country's fastest-growing residential property markets.
Banks are increasingly betting that the next wave of Kenya's mortgage growth will come from regional cities rather than Nairobi alone.
