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Kenyans Dreams of affordable homes now a reality

Residential houses at RIAT Hills: Many developers are moving out of the city centre to areas further afield.

Residential houses at RIAT Hills: Many developers are moving out of the city centre to areas further afield.

Kisumu’s growth in recent years has seen the lake-side city expand rapidly as people move in to tap into the expanding market for goods and services.

Part of this expansion can be attributed to the rapid expansion of industries in the town, with the latest being a cement manufacturing plant in Awasi, the Kibos sugar factory and the expansion of satellite university campuses in the town.

Other factors include the upgrading of the Kisumu airport to international status as well as the ongoing construction of a second airport in Awasi.

But while this is good news because it will create more employment opportunities for the local people, it has led to a serious housing crisis, especially for middle- and low-income earners, most of whom cannot afford the type of houses that have been built by developers in the city.

These days, it is hard to find a bed-sitter in the town, and if you find one, it is likely to be expensive. For instance, a bed-sitter in an area like Nyamasaria has been going for Sh5,000, which many low-income earners say is too high, given their levels of income.

“Most of the houses in the area are unaffordable for low-earners like us, who are also required to provide for our extended families,” says Mr Peter Otieno, a father of two.

The chairman of Kisumu Real Estates, Mr Wycliffe Abok, agrees, saying the rapid growth of real estate in the lake-side city has pushed up property prices beyond the reach of many.

“The industry has completely locked out people who earn less than Sh50,000, yet they make up a huge market,” says Mr Abok.

It is in response to these people’s needs that developers are coming up with strategies to reduce the shortage by building affordable housing.
This is evident from the number of apartments currently under construction in various estates around Kisumu.

MAXIMISING LAND USE

Ms Nishma Sedani, the proprietor of Lake Estate Agency, says that one of the strategies for maximising on land use is by building apartments.

“Theconstruction of apartments, which is common in Nairobi, is gaining ground here in Kisumu, and many people now understand that they do not have to be land owners to be home owners,” she says.

“Middle-income earners with a steady income can buy space above someone else’s house and have a home.”

A drive into Kisumu town on the Kisumu-Kakamega highway reveals rows upon rows of flats and maisonettes under construction, a situation clearly indicating that investors have woken up to the situation and are striving to provide affordable houses.

Mr Nick Opande, the owner of Africa investment and also a property investor in the town, has also come up with a plan to ease the problem using what is known as fabricated houses initiative.

In the proposal that has already been approved by the county government and awaiting implementation, the project is modelled on the lines of the NSSF Nyayo estate houses in Nairobi’s Embakasi area.

According to Mr Opande, the project will be carried out in collaboration with the county government, which will buy the of land where the houses will be built.

Investors will then construct apartments, which Mr Opande says will be rented out for between Sh5,000 and Sh8,000 for a two-room house.

THREE PHASES

“The project will be implemented in three phases, and we plan to begin as soon as we get the full financial commitment from other investors,” he said.

Similarly, Kisumu Real Estate Company has already rolled out housing projects targeting middle-income earners. One such project is the Milimani West estate, a gated community.

The project will sell plots, which come with ready title deeds, for between Sh65,000 and Sh250,000 for a 0.02 ha on the 60-acre parcel of land.

“We are adding value to land in that you get a title deed plus the plan of the house you will build since we want uniformity,” explained Mr Abok, the operations manager of Kisumu Real Estate.

The 60-acre parcel of land has been sub-divided into 378 plots of 250 square metres, each of which is enough for a 4-bedroom maisionette, a servant’s quarter and a parking bay, with the prime plots going for Sh250,000.

Ordinarily, such a plot would go for between Sh700,000 and Sh1.5 million in middle-income estates in Kisumu, or even twice that amount in the suburbs.

Once one acquires a plot, they will be required to finance the construction of their house on the land within two years.

“We are not in it to make super-profits, but you can be sure we are not incurring losses,” says Mr Abok.

But even with these new investments coming up, most middle- and low-income earners are still grappling with avenues of sourcing for cash to purchase these houses.

Hopefully, this will soon be an issue of the past as banks and other financial institutions come up with friendlier mortgages and loans for buyers.

MOVE FROM THE TOWN CENTRE

Another notable thing is the shift by investors from the town centre to other areas that were initially considered unsuitable for building houses such as Kibos, the Riat Hills, Holo and Awasi.

Investors say this shift has been informed in part by the realisation that the town centre and its immediate surroundings are currently recording an influx of businesses and industries as the town gears towards a 24-hour economy.

This trend has seen has seen areas such as Kondele, which have long been known as violent hotspots, becoming favourites of many investors who are keen on maximising on the area’s vast potential market.

Mr James Angoye, who owns a chain of retail shops as well as a wholesale store in the area, attributes the exodus from the town centre to population growth.

“The town is expanding rapidly so even we businessmen have to rush to areas outside town to get premises from which to operate,” he said.

Estates such as Milimani, once Kisumu’s best known high-end suburb, has been invaded by businesses seeking to expand from the city centre.

The face of the estate has changed considerably, and the bungalows and double storey building buildings that once characterised it are now dwarfed by tall buildings, some of which house businesses.

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If the government takes your land and finds it unusable, it must give it back

With the property boom in many urban centres in the country, it helps to know the legal position with regard to property. Below are some precedent setting property cases decided by Kenyan courts.

1. If the government compulsorily takes your land and later finds it unusable, you are entitled to get it back

This was the message from a decision of the Court of Appeal sitting in Kisumu. In its judgment of October 18, 2013, it ordered the return of a parcel of land to 13 people in Awendo, Migori County. The government compulsorily acquired the land from the 13 people in 1976 for the expansion of the South Nyanza Sugar Company (Sony). However, some portions of the land were found unusable and were, therefore, not used.

The then Town Council of Awendo took over the land, saying it was entitled to do so since the land belonged to the government. The 13 original moved to the High Court demanding back the land and won.  The council appealed against their victory but lost again at the Court of Appeal.

The High Court said the unused portions should be re-surveyed and given back to their rightful owners.

“Section 75 of the Constitution requires that once land has been compulsorily acquired, it ought to be used for the designated purpose only. The original owners of the suit land ought to be registered as the lawful owners of the unutilised parcels of the suit land,” the three-judge bench noted.

2. Seeking a rent refund? Make a convincing plea before the court or forever hold your peace

The High Court in Busia made a notable statement in its judgment of November 13, 2013, when it said that a tenant “will have to live with the consequences of a poorly pleaded and prosecuted case.” This was the observation of Mr Justice Francis Tuiyott in a case in which the accuser, Peter Kimani, realised that he might have overpaid his landlord, Jonathan Wabala, following a deal they had struck to enable him to pay his rent arrears.

Kimani had rented Wabala’s property between 1993 and 1996, but by the time he left, he had not paid the rent, so they struck a deal according to which he would to pay Wabala in instalments until he cleared the balance.

However, Kimani realised at some point that he might have overpaid his former landlord. He accused the landlord of misrepresenting facts in their agreement. He first lost the case in a lower court before appealing to the High Court, where he again lost because he had not made it clear how exactly he had overpaid Wabala.

3. Even if you run away without paying rent, you will have to pay up as if you gave notice

The High Court in Eldoret handled a case in which a man lived on leased land from January to October 2012 without paying rent.

Consequently, the landlord, John Makwata moved to court seeking orders to evict the tenant, Mr Isaac Ochebo.

But by the time the court made its ruling on September 26, 2013, Makwata had long moved from the land, though he didn’t pay up before doing so. Because he never showed up in court to defend his case against Ochebo, the court accepted a majority of the landlord’s pleadings.

It ordered that he pay the rent due on the leased one-acre plot, which stood at Sh220,000, plus an additional Sh75,000 to make up for the three-month notice he should have given, since the monthly rent was Sh25,000.

4. Who is responsible when a construction worker gets injured on the job?

Imagine you own a construction company working on a project and one of your workers is involved in an accident. What would you expect to happen if the worker goes to court?

The High Court in Kakamega ruled on a case in which Absolom Agala had sued Imco Building and Engineering Construction for damages after he fell off a ladder at a construction site and ruptured his urethra.

The amount the High Court could award Agala was Sh350,000. But in its judgment of September 24, 2013, it observed that he be paid half the amount. Reason? Justice Thuranina Jaden decided to apportion blame for the accident on a 50-50 basis. And since Imco had already paid Agala a total of Sh179,700, the court ruled that he be paid no more.

Source:Kenya Law Reports website

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