The Challenges of Owning a Home in Kenya

Every Kenyan carries one dear dream in his or her heart: owning a home!

This is one of those goals that we carry in our hearts and strive towards for so long. Yet with all the financial challenges and many things demanding our attention and money, many of us are unable to fulfill this dream.

Those who manage to own a home work very hard and have to be very organized to achieve this seemingly humongous goal.

buying a house in kenya thumb The Challenges of Owning a Home in KenyaHousing in Kenya is actually a big problem. Property prices are way up there while the average Kenyan earns too little to afford a good house. We keep talking about the property market stabilizing and prices coming down, yet with each passing year, prices are going up or at least staying up.

If you drive through the upper middle class estates of Lavington, Ngong road, Kileleshwa and so on, you will notice numerous housing constructions going on. Many more estates and apartments are finished and the ‘TO LET’ or ‘HOMES FOR SALE’ boards are numerous.

Who is The Target Market?

I keep wondering who the target market is every time I come across these boards. How can a simple Kenyan earning a salary of 40,000 Kenya shillings or less buy a house?

Moving over to the other side of town i.e Eastlands, numerous cases of flats collapsing have been reported. The CBD has also faced these cases that have led to injuries and fatalities.

The blame game continues on who is to blame for these failed constructions. When a building collapses, its amazing how hard it is for the authorities to trace the owner of the building on the contractor in charge of that building.

Accessing a mortgage is yet another nightmare the common Kenyan is facing. Very few financial institutions are willing to fund you 100% therefore you need to raise about 10-20% of the cost of the home. Before you even get there, will you qualify for a mortgage and will you afford the monthly repayments?

I can bet you, the common Mwananchi will actually not qualify for a mortgage or afford the monthly repayments. Think about it:

For a mortgage of 3 million shillings, you need to first raise the 10% deposit which comes to 300,000 shillings. If your mortgage was for 30 years at an interest rate of 15%, your monthly repayments are Ksh. 34,140.00.

How many people can afford to pay this every single month for the next 30 years? Not many. Over a thirty year period, you will end up paying well over 12 million shillings.

These figures simply scare most Kenyans into retaining their status quo of renting a house.

The option of buying land and constructing your own house has its challenges too. You still may need to get a construction loan and face the same challenges of down payment as well as monthly loan repayments.

We need a new and creative approach on the issue of owning a home in Kenya. Many countries have faced the same problems and have come up with ways to make construction and home ownership cheaper and more affordable.

The questions that all Kenyans have in their minds is how can I own a home? It’s a high time that all the stake holders in this industry come together and chart a way forward. Otherwise a home will be a privilege only for the rich.

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