Point Properties Ltd – Real Estate

Title deeds to be issued afresh to curb fraud

Title deeds are set to be registered afresh as the State shifted the administration and management of land to new laws to boost efficiency in transactions and curb fraud. The Lands and Physical Planning ministry said the titles will now be handled under the Land Registration Act, 2012 —which comes with significant changes in the manner private land is managed. A pilot run of the migration is already underway in Nairobi with some 5,493 parcels already marked for conversion by the Registrar of Lands. “All transactions or dealings relating to parcels within the registration unit shall from April 1,2021 be carried out in the new registers,” the ministry said. Under the old legal regime, title deeds were issued under the Registered Land Act (RLA), the Registration of Titles Act (RTA), the Land Titles Act (LTA), and the Government Lands Act (GLA) that have now been repealed. “Each of these pieces of legislation created its own register, making land registration complex. The confusion occasioned by the different regimes has become a breeding ground for fraud, delays in service delivery, centralisation of land services and threats to the right to property,” Lands Cabinet Secretary Farida Karoney said. Titles issued under the RLA and…

Towns to Watch as Kenyans Move Away From Nairobi

The real estate market in Nairobi has witnessed an emerging trend over the last year in which more and more residents are moving away from the capital and into emerging satellite towns. These towns are in different counties, but which border the Kenyan capital, where a rapid improvement in infrastructure and affordable housing has resulted in a mass migration from Nairobi. Satellite cities are small or medium-sized cities near a large town, for instance; smaller towns near Nairobi, Mombasa, or Kisumu. Most of these satellite towns predate the metropolis’ suburban expansion and are partially independent of the bigger town both economically and socially. Motorists pictured on the Eastern bypass road. Some of the counties that have benefited a lot due to their proximity to the city include Kiambu, Machakos, and Kajiado, which all have satellite towns considered part of the Nairobi Metropolitan area. According to HassConsults 2020 Land Price Index report, these satellite towns controlled approximately 60% of property transactions in 2020. Kitengela 19.1% control, Ruiru 15.1%, Thika 9.4%, Ongata Rongai and Ngong both tied at 7.9% market share of the properties on sale. For 2021, the investment opportunity within the Nairobi Metropolitan Area land sector lies in satellite towns…

Developers raises Sh1.3 billion in Nairobi housing project sales

Clay City Developers Limited has sold about six percent of its 5,200 affordable houses located at Clay City on Thika Road in Nairobi, raising Sh1.3 billion from the sale. The Clay City project, which sits on 36 acres is being built through a joint venture between Housing Finance (HF) Development and Investment and Clay Works Limited. The Sh11 billion project is being funded by a mix of debt, equity from foreign funds and contractor financing. “There are about 333 two-bedroom units in the first phase of the project that have been sold. A unit is going at Sh3.9 million,” Clay City Developers chairman Matu Wamae told the Business Daily. The housing project consists 1,560 three-bedroom units selling at 4.6 million each and 2,080 two-bedroom houses selling at Sh3.9 million each. There are also 780 one-bedroom units each selling at Sh2.4 million and 780 studio units selling at Sh1.5 million. The project will be built in five phases. Work on the first phase of the project will run for 24 months, with the entire project set for completion after five years. “Clay City has an advantage because it is close to major learning institutions situated along Thika Road, which also offers…

A Nairobi landlord has moved Kenyans on social media following his decision to reduce monthly rent for his tenants. In a letter dated October 17th, the property’s manager identified as Simon Ngugi asked occupants of Muhu Building on Naivasha Road in Dagoretti North, Nairobi to pay Sh2,000 less on rent beginning November 1st, 2019. Occupants have been paying Sh10,000 per month for each unit, meaning the same house will cost them Sh8,000 from this month. The letter also copied to the landlord John Roki, stated that the decision was made to retain current tenants and attract new ones due to “serious business fall.” “We have noted a serious business fall in recent months. We, therefore, extend our support to your business by reducing your rent,” Simon Ngugi noted. “Your new rent from November 1, 2019, is Ksh8, 000 down from Ksh10,000.” Speaking to K24 Digital, the building’s agent Paul Newton confirmed the authenticity of the letter. “Yes, the letter is genuine. We arrived at the decision after keenly scrutinizing how our tenants settled their rent arrears in the last few months. Honestly, we noticed they were struggling to raise the money, and, therefore, we had to reduce the monthly rental…

Experts in the real estate sector have welcomed President Uhuru Kenyatta’s decision to reject the Finance Bill and his recommendation to MPs to scrap lending rate caps saying that if parliament adopts the head of state’s position, the industry will recover massively. Speaking during an interview with Business Today, VAAL Real Estate CEO Majeed Saad said that the capping of interest rates has had a negative effect on the sector as contractors and buyers have struggled to access much-needed credit that would have spurred growth Cap on Interest Rates “In my opinion, repealing the law boards a positive future for real estate in the sector. Just like any other industry, real estate depends on the circulation of money in the economy. So I think that repealing it would be best for all parties involved,” said Mr. Saad. In an interview with Business Today in June, Knight Frank Kenya Managing Director Ben Woodhams said that the industry slowed down in 2016 shortly after the capping of interest rates. “When I came into the Kenyan market in 2003, we witnessed growth in the property market through to 2015. Even though the global economic recession in 2007, we witnessed the Kenyan economy and the real estate market…

In Kenya, the real estate industry is a free market in that the price of housing is driven by supply and demand. The higher the demand, the higher the prices with the inverse also applying. Over the last couple of years, the Kenyan economy has witnessed exponential growth of the middle-class. What this means is that as the disposable incomes of more Kenyans increase, many people are able to construct their own homes and are also able to get mortgages to buy houses. This, in turn, fuels the real estate sector. As the real estate industry appears to be more lucrative and with limited supply, speculators come in, further driving the prices higher. A housing bubble comes about when the market prices reach unsustainable levels and naturally decline. According to the International Monetary Fund (IMF), the bubble is a temporary event which may last up to several years. The property sector exists in relation with other sectors and one can predict the trend of real estate with other factors in the economy. With these, you can identity a housing bubble. But how can one predict the markets? How can one differentiate the realistic price rise from the bubbles? Read more……

The 2018 World Bank report on the ease of doing business in Kenya based on the parameter of acquisition of building permits and development approvals ranked the country at position 124, below Rwanda (112), Botswana (59) and Namibia (107). The poor ranking was attributed to the long processes and lengthy periods needed to acquire a development permit with some applications taking up to 156 days. A recent survey conducted by the Architectural Association of Kenya (AAK) indicates that while Nairobi, Mombasa and Kisumu counties had e-construction permit systems, users still face a myriad of challenges including frequent downtimes and delays in processing of applications. The average time taken to acquire a building permit in Nairobi ranges from between three months to two years. The delays a largely due to the human interaction with the portal. These delays not only impact negatively on investor confidence and ease of doing business in Nairobi, but also serve as a precursor to the construction of unauthorised structures and urban sprawl. The Central Bank 2018 fourth quarter report revealed that real estate developers were the biggest loan defaulters at Sh44.4 billion, a 15.8 percent rise outpacing non-performing loans by manufacturers (11.7 percent) and traders (7.3…