BUILDING ON KENYA’S REAL ESTATE SECTOR GROWTH
During the country’s rebasing – replacing of the old base year used for compiling the constant price estimates to a new and more recent base year – Kenya’s GDP increased to 55.2 billion US dollars in 2013 from 44.1 billion US dollars, a 25.3 per cent jump. The real estate sector contributed 5.9 per cent accounting for some change in the level of the country’s GDP.
The country’s booming property market is said to be responding to demand that has been created by the expanding middle class.
Recently, players in the industry held the 20th Kenya Homes Expo in Nairobi. The expo garnered local and international exhibitors drawn from various sectors of the real estate industry.
According to Daniel Ojijo, executive chairman at Homes Universal, one of the best places to network and consult with players in the industry
“Kenya homes expo has grown into a formidable force the forum has not only provided an avenue for industry professionals and investors to network and expand the knowledge but have been a great boost for the industry initially helping to demystify the sector from an illicit activity to one where even a village investment group can invest the challenge of providing housing,” Ojijo said.
Over the years, the Expo has grown tenfold from 40 exhibitors during its inception in 2005.
“Kenya Homes Expo has close to 200 exhibitors displaying their products and this participation is from more than 20 exhibitor categories. Presently over 50,000 exhibitors go through the exhibition stand during the 4 days of this event.”
Currently, the total number of mortgage accounts in Kenya stands at 20,000 which is significantly below the demand for housing units of more than 200,000 per year and growing. There is therefore an urgent need to increase the supply of new and affordable housing units.
In this regard, Ibrahim Hussein, director of administration at the Ministry of Land, Housing and Urban Development says the Kenyan government is committed to working with all the sector players, towards addressing the issue of affordable housing.
“We urge the financial institutions in this country to work with the government towards enhancing access to affordable housing finance through the following interventions: Lowering the mortgage rates, lengthening the mortgage repayment periods by embracing multi-generational mortgages and restructuring mortgage repayment mode in order to accommodate the informal sector.”