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Kenya

KCB adapts to homeowners needs

NAIROBI, Kenya, May 25 – With demand in the housing sector increasing, Kenya Commercial Bank\’s Mortgages Division is looking to structure its business to focus on developing housing segments.

KCB Mortgages Division Director Caroline Kariuki said the lifestyle of homeowners is constantly evolving creating new markets, which the mortgage financier would like to exploit.

Mrs Kariuki said an assessment of the market has shown that homeowners are continually upgrading their homes over time and increased disposable income creating vibrancy in the market.

"Younger customers will have different needs from those of a married couple with children or older home owners who want to move out of their large houses into an executive apartment. There are new markets coming up which is exciting," Mrs Kariuki said.

The construction industry is one of the fastest growing in the country with increased appetite especially with creation of county governments.

The demand for residential houses has doubled to 300,000 units per year against an annual supply of 50,000 houses.

"The concentration has been around the middle class and the upper end, but what we are seeing is greater appetite by banks to take on mortgage lending; we will see a shift to more affordable housing spread across the country with the creation of counties," she said.

The property market is facing challenges with economic pressures owing to rising inflation and high fuel prices pushing up construction prices.

She however said this has not affected the demand for housing with developers surging on with their projects.

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"We have not seen a slowdown in the housing sector, in any case we have seen a lot more players coming into the market, which is positive because it bridges the gap between demand and supply," she said.

The government is working on implementing the National Land Policy that will put in place a land use management framework that will support investments within the sector and address the situation where physical amenities have been overstretched or where land is developed without the provision of adequate infrastructure.

She was speaking during a briefing for members of the Kenya Commercial Bank Group\’s Developers Club who include Architects, Quantity Surveyors, Engineers and Estate Agents who will be travelling to South Africa in June to learn from their building construction expertise.

During the tour, the developers will tour low cost housing projects and get a deeper understanding of the South African construction market.

The bank views such trips as an ideal way of engaging with market players in promoting the adoption of affordable housing models for the local property market.

"We hope our developers will carry with them some of the solutions that can be employed by our local construction sector in reducing the current high cost of housing," Mrs Kariuki said.

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