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Thursday, October 22, 2020

The home buying scandal that left hundreds of Kenyans in tears, losses

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In May this year, real estate company Banda Homes hit the headlines after it was busted for what looked like another real estate scam.

The firm had failed to deliver houses to its clients two years after receiving hundreds of millions. The buyers bought the houses in an off housing plan. The houses were to be built along Thika Superhighway at Pinewood and Rosewood estates. The buyers paid Sh. 3.9 million each for the houses. A site visit that was conducted by buyers on Saturday revealed that the houses are far from ready.

The buyers questioned the quality of work done. However, Andrew Kamau, the developer, blamed the coronavirus pandemic for the delays. Kamau is the same guy who used to run the defunct Dinara Developers. At one point, he bragged how he made up to Sh. 20 million per month. “I make between Sh. 20 million and Sh. 25 million per month,” he claimed.

This, though, was not the first time that Kamau and Banda were getting caught up in hot soup for failing to honour construction agreements.

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In February last year, Banda Homes Limited was accused of shortchanging their buyers. The developer was accused of failing to deliver homes to buyers despite having received deposits amounting to Sh 1.5 billion since 2018.

The reports claimed the money raised was used partly to pay for the land where several other estates will be built on Kenyatta Road and in Kikuyu near Sigona and to finish up old projects. The firm, the reports claimed, has re-branded at least two times since 2011, during which it has acquired new names to avoid being followed by clients after allegedly failing to deliver on projects.

The case of Banda Homes comes as the latest episode in a series of real estate fraud games that have been leaving buyers reeling from losses in the tune of millions. Companies such as Gakuyo Real Estate, Simple Homes, PRC, Diamond Property Merchants, and Suraya have all been the subject of grievances and court cases from disgruntled buyers.

According to Gachie Mwangi, an advocate of the High Court, developers have been hoodwinking buyers by including clauses that exempt them from liability in the event that they fail to deliver the houses in time.

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