Shortage of high-end homes keeps big spenders out of Kakamega town
The real estate sector in Kakamega town is on a growth pathway with notable development taking shape in recent times, especially with the upgrade of Kakamega- Kisumu highway.
In the past few years, remarkable development has been experienced in the housing segment in the town.
However, according to sector players in the town who spoke to Boma, a mismatch in provision of residential houses, has left shortages in certain areas Real estate players say Kakamega town has an oversupply of bedsitters, one bedroom and two bedroom houses, but has gaps in supply of high end buildings for certain population segments, especially the high class segment.
Marian Properties Ltd director Peter Juma says the town has a short supply of specifically three bedroom houses, homes with own compound and gated communities where certain standards and amenities are often offered.
Juma says the imbalanced housing supply is attributed to developers not properly analysing the property market trends before coming up with their projects.
He advises that developers in the housing segment need to accurately analyse the property market and align themselves to the current population demand.
“Some of the developers coming to the town have failed to carry out a proper analysis of the reality on the ground on which areas need to be largely served. This has largely informed the kind of developments we are witnessing here,” he says.
Juma notes that many developers are mainly engaged in development of two-bedroom houses, leading to an excess supply. He states that the two bedroom category, however, lacks proper finishing, security features and adequate space.
A two-bedroom house with premium finishing in the town goes for up to Sh20,000 in rent on the higher side. This is in addition to other facilities, such as security, free water supply and CCTV (Closed Circuit Television) cameras.
On the other hand, a two-bedroom house with basic finishing rents for about Sh8,000 depending on the location. One-bedroom house rent ranges between Sh6,000 and Sh15,000 while a spacious bedsitter can fetch between Sh5,000 and Sh10,000 in monthly rent in estates, such as Amalemba, Milimani and Joyland.
The bedsitters are predominantly rented by university students and part-time lecturers who prefer affordable small houses. Juma says most residential houses in the town have good structures and are spacious, but have poor finishing, a factor that is making them less attractive to certain classes of people.
“Generally, the residential housing situation in Kakamega is under pressure in terms of quality and quantity. A good percentage of houses on offer do not meet the standards required by a sizeable number of population,” Juma explains.
Jared Mudanya, director of B-bros company Ltd, concurs. He says most of the houses have basic finishing, hence executive dwellings are hard to come by in the town. Mudanya says the few available rental houses with premium finishing are pricey but still not attractive to the high spenders.
As a result,he states that people with high income working in Kakamega prefer to stay in more developed nearby towns, such as Kisumu. “The standard of many houses here are comparatively low forcing the workforce to commute from satellite areas and Kisumu town,” Mudanya says.
Juma says potential developers planning to put up properties in the town should focus on building modern houses, which are well finished. Such investments, he says, are likely to attract good returns.
Growing demand The entrepreneur points out that there is growing demand for quality housing that is being absorbed by increasing middle class population. This area, he says, is grossly underserved. Consequently, he says there is a relatively rising demand for three-bedroom and above houses with own compound and apartments.
The businessman says however, there is such kind of a development coming up in Amalemba and Muyala along Mumias road. At the same time, Juma stresses that there is increased potential for prospective investors to tap particularly in the peri-urban areas.
Such development zones, he says, are best suited for gated-community concepts that offer viable investment opportunities. He says opportunity exists in own compound homes, three-bedroom to four-bedroom houses. Further, he points out that there is room for decent two-bedroom and spacious bedsitters to cater for the young professionals.
Mudanya observes that lack of industries is slowing down the overall real estate growth and demand for houses in Kakamega. “The growth in the industrial activities in this county will increase disposable income and eventually spur real estate growth, hence increase demand for houses,” he says.