Homebuyers Crowd Court as Key Housing Fight Deepens

Homebuyers Crowd Court as Key Housing Fight Deepens

Jun 14 , 2026. By NAHOM AYELE ( FORTUNE STAFF WRITER )

More than 50 homebuyers mobilised by Key Housing Finance Solutions packed into a Lideta courtroom on Bekele Weya (Dej.) St., spilling onto balconies to await oral arguments in a collective civil suit filed by 236 plaintiffs against the developer and Bunna Insurance Company. The litigation shifted focus from simple construction delays to a critical legal question. Can a mass subscription-based housing scheme be legally unwound after its core security instrument is invalidated? Facing severe court docket backlogs, judges deferred oral arguments to next month.

The crowd arrived before the judges did, turning the quiet civil benches at the Lideta Division of the Federal High Court, on Bekele Weya (Dej.) St., into a stage for a dispute over housing finance, contractual promises, and regulatory protection.

More than 50 homebuyers mobilised by Key Housing Finance Solutions packed into a cramped courtroom on Tuesday, June 9, 2026, some standing inside and others spilling onto balconies, waiting for oral arguments in a collective civil suit that has drawn hundreds of buyers into litigation. The case was filed in June 2025 by 236 homebuyers against Key Housing Finance Solutions and Bunna Insurance Company.

The plaintiffs are seeking restitution of 29 million Br in aggregate advance payments, accrued legal interest, and "compensation for consequential damages and lost opportunities." Their claim alleges breach of contract and financial misrepresentation tied to a housing finance model that promised a long-term route to homeownership but, they allege, left their savings exposed when its guarantee structure collapsed.

Key Housing Finance Solutions, a share company in which Girum Assefa, a businessman, holds a 20pc equity stake and which has been linked to his media involvement with Abbay TV, had marketed a plan to construct 100,000 residential units over 10 years. Buyers entered 30-year contracts and made monthly payments, relying on a 10-year delivery guarantee. For many at Court last week, the dispute is no longer about delay. It is a fight over whether a mass subscription-based housing scheme can be unwound after the instrument meant to secure it was invalidated.

That instrument was the individual performance guarantee bond issued by Bunna Insurance Company. Buyers paid additional premiums for coverage, understood as protection against the developer's potential non-performance. The arrangement unravelled after the National Bank of Ethiopia (NBE) issued a regulatory decision declaring the underwriting policy invalid under the existing directive regulating the financial sector. Bunna Insurance revoked the policy, stripping the model of its selling guarantee.

Represented by Mulugeta Belay Law Office, the plaintiffs argued that Bunna Insurance’s withdrawal amounted to a fundamental material breach. They rejected Key Housing’s later replacement of the Bunna guarantees with policies from the state-owned Ethiopian Insurance Company (EIC), claiming the substitutes covered conventional mortgage and accident risks, not full principal protection against corporate non-performance or insolvency. The buyers claim they paid into a structure premised on protection from developer failure, not ordinary insurance attached to a mortgage transaction.

The litigation has spread beyond the Court in Lideta. At the Qirqos Division Civil Bench of the Federal First Instance Court, 32 additional homebuyers filed a parallel suit claiming collective losses of more than eight million Birr. The claim is below the 10 million Br statutory threshold for High Court jurisdiction; the matter was routed to the first-instance bench. Both groups asked for urgent conservatory measures, warning that Key Housing could alienate, transfer or dissipate assets before judgment.

The benches granted the requests, freezing up to 59 million Br across the company’s corporate bank accounts and barring the transfer, sale or disposal of a commercial building under construction in Akaki Qality District. Those orders gave the plaintiffs interim security, but not the hearing they expected. During last week's hearing, with attorneys for both sides present, the packed courtroom waited for arguments expected by subscribers frustrated by the slow pace of the proceedings.

The judges did not take the open bench, as proceedings eventually began from the Judges’ offices rather than the courtroom. Legal representatives were called inside, where the court cited severe docket backlogs and informed plaintiff and defence teams that oral arguments could not be heard that afternoon.

The decision tested the room. Plaintiffs who had waited for quite a few minutes reacted with angry murmurs and resisted leaving after the adjournment was announced. Lawyers and judicial security police had to move them out of the building. Even after the courtroom emptied, groups remained on the courthouse grounds, complaining about the pace of proceedings.

Before the dispersal, Mulugeta’s legal team used the chamber session to submit an urgent supplementary petition. The filing sought to strengthen their argument that Key Housing lacks operational capacity. Under current execution rates, the lawyers argued, delivery to the original subscriber pool could extend beyond 30 years, exceeding the pledge around which the contracts were promoted.

The plaintiffs’ lawyers also appealed to the Court to admit new evidence in a video recently broadcast on Key Housing’s official TikTok channel and submitted on a CD. They argued it showed the company allocating houses to new buyers through a raffle, while earlier subscribers remained without delivery.

“The video clearly demonstrates that Key Housing is sidelining the rights we, the plaintiffs, previously acquired under the contract, by including new buyers in the lottery and allocating houses to them,” the legal team argued to the bench. “This action severely diminishes the chances and rights of us, the prior buyers, breaches the contract, and thoroughly illustrates that we can't be entirely certain when our contract will ever be fulfilled.”

The lawyers petitioned that the timing of the broadcast demonstrated why the material had not been attached to the initial claim.

“Since this evidence was only recently released, we're unable to attach it to the initial lawsuit,” they stated. “Because the evidence originates from the defendant itself, it can't be denied, and it serves as a critical piece of evidence that will assist the court in delivering proper justice.”

The video features an individual stating he received a house two weeks after registration. The Court accepted the supplementary petition into the record and adjourned the case for oral arguments.

Outside the main building, as security guards urged the crowd to disperse, Mulugeta, the plaintiffs' lawyer, urged his clients to contain their aggravation. He told them the matter had been deferred “due to the court's current heavy workload,” confirmed that the supplementary evidence had been admitted, and advised the subscribers to return home. He also urged them to mobilise again for the July hearing.

The underlying claim reaches beyond the failed guarantee. The plaintiffs claim Key Housing’s operations were an “illegal pyramid-style scheme,” alleging that money mobilised from newer subscribers is used to finance earlier obligations in “a model that can't last.” They also accuse the company of operating beyond its statutory licence, engaging directly in real estate development, property leasing and civil construction in breach of financial-sector laws.

Key Housing’s promotional material promised turnkey and fully finished residential units with custom kitchen cabinets and premium interior fittings, according to the filing. The plaintiffs allege that the few units distributed through the raffle "are incomplete, half-built block-wall shells rather than finished homes." They also claim Key Housing has begun unilaterally terminating contracts of dissenting subscribers, deepening what they describe as "an erosion of trust."

The buyers appealed to the judges to formalise rescission of the contract, hold Key Housing and Bunna Insurance jointly and severally liable, and order full financial restitution.

PUBLISHED ON Jun 14,2026 [ VOL 27 , NO 1363]