BY PETER MUIRURI – Home ownership options for young Kenyans
Rose Obonyo is a 25-year-old suave urban dweller. As a communication specialist, she describes herself as organised, a go-getter who leaves nothing to chance in the course of her work. But Obonyo is also a frustrated young woman.
For the three years she has lived in a rented house – all in Nairobi – she has never known peace, moving houses four times. “The first house was way too small. It could hardly fit a four feet by six feet bed. So little was the space left that I had to choose between installing a bookshelf or a television set. I chose the bookshelf.
The second house was a bit bigger but was next to the watchman’s toilet, letting into the house foul smell. The plumbing system was not installed properly, leading to water contamination. Her third house was next to a dusty road that caused her a lot of allergic reactions. She is currently on the fourth one near Taj Mall:
“Here, I am thoroughly “entertained” by a nearby church and two bars, one on each side of my house. And then comes the expansion of Outer Ring Road. More dust… and power surges. I have had it all,” says Obonyo. When I asked her what the solution would be, she said: “Owning my own house.”
Home ownership journey
With her own house, she says, she would have full control of the home and make whatever changes she deems necessary, including decorating it without fear of reprisals from an overbearing landlord. Despite the odds stacked against them, Obonyo joins a growing list of young people who hope to live in their own houses in the near future.
According to a number of property reports in recent years, it is the youthful population that will drive investments in the real estate sector. In its annual market outlook report for 2017, investment firm Cytonn says developers will have to work overtime to satisfy the group’s housing, entertainment and consumption needs. “Rapid population growth and the youth bulge (21 to 35 years) will drive real estate development in 2017,” says the report.
Players in the sector can no longer ignore this crucial demographic that now views home ownership a goal worth pursuing. Abraham Muriithi, Property Reality Company’s general manager, says their model of adding value to land across the country has attracted a substantial number of young people. He says most of those buying land though the company do so with the goal of building a family home.
“It is true that people view land as an investment vehicle since it always appreciates in value. However, a young person would want to build a house for himself eventually,” says Muriithi.
This is the view held by Sheila Kimani, a digital media manager who says she has been saving to buy a piece of land that she hopes to flip over for a profit before settling down to build her own house. Now in her early 20s, Kimani says she will have to sell a number of plots and acquire enough to enable her embark on home ownership journey.
“Young people need to take home ownership seriously. Since they may not have enough funds for that endeavour, the best route is to invest in some piece of land that one can afford, wait for it to appreciate, sell, and if possible repeat the process, thus building up funds for construction or home purchase,” she says.
According to Muriithi, young people can become homeowners if they refocus and drop money wasting tendencies. “Bad lifestyles such as extreme partying come in the way of home ownership. Even saving to buy that latest car when one is still a renter is not a wise move. Only when they grow older do that reality dawn on them. It is better to make wise decisions now,” advises Muriithi.
Home ownership options
Locally, Suraya Property Group has spearheaded the construction of what they term as starter homes on Mombasa Road. With starting prices of between Sh. 900,000 and Sh4.5 million, the 900 units were meant for young people who could manage to save for the deposit and obtain a manageable mortgage facility. Some 35 per cent of buyers in the Sucasa project are young people.
The reason such houses are termed as starter homes is that as their value appreciates, owners are at liberty to dispose of them at a higher price and use the proceeds to climb the home ownership ladder. Muthoni Ndego, the sales and marketing manager at Suraya, says for young people to benefit from such projects, they have to change their mindset and be willing to move to less affluent locations as they save for their dream homes.