Published on July 16, 2024 by Agencies for Kenya Online News
Last Updated on 2 years by Agencies for Kenya Online News
NAIROBI, KENYA, JULY 15, 2024 – Faulu Microfinance Bank, a subsidiary of the Old Mutual Group, is set to unveil new solutions to seal the gaps in financial service access affecting landlords, agents and other players in real estate development and management.
These solutions include a faster turnaround time for unsecured loans, customized financial solutions for development and property improvement, payment plans aligned with rental income, simplified and efficient application procedures, and funds for scaling and expanding properties.
Additionally, Faulu Bank will offer performance-based incentives to agents, and promotional opportunities to showcase upcoming developments.
“This initiative seeks to establish Faulu as the preferred financial partner, offering tailored solutions and fostering long-term relationships with landlords and agents, who are key stakeholders in the country’s real estate sector. By engaging with these groups, we aim to tap into a significant market, providing financial solutions that are tailored to unique needs and challenges of the housing industry,” said the Bank’s CEO, Julius Ouma.
Landlords and agents are essential players in the real estate ecosystem, facilitating the rental and sale of properties. Landlords provide housing options, while agents act as intermediaries, connecting tenants or buyers with suitable properties. Their collaboration ensures efficient property management, tenant placement, and transactions, contributing to the stability and functionality of the real estate market.
Faulu’s latest solutions have been announced as Kenya’s housing sector emerges as an influential contributor to the country’s economic transformation. Accounting for up to 10% of the national GDP, real estate remains prominent as the demand for housing surges especially in urban areas. The rapid urbanization of the country, currently at 3.7% per annum with 29% of Kenyans living in urban areas, as per the World Bank, is increasing the need for rental property.
Indeed, with the growing demand for affordable housing, many developers are keen on single rooms, bedsitters and single-bedroom apartments, which are more preferred by people at the beginning of their careers and new entrants into cities, a majority of whom have limited incomes. In 2019, for example, Nairobi saw the construction of 3,940 one-room units, marking an 84 percent increase from the 2,135 units built in 2015, according to the most recent data on housing from the Kenya National Bureau of Statistics (KNBS).
Some of the housing trends and opportunities in Kenya as per the KNBS report show that the sector is expanding rapidly both formally and informally, although challenges abound in product flexibility and ease of access for borrowers and potential homeowners. The report also identifies critical advancements in construction technologies and processes for buying, selling and renting properties as key components in transforming the sector.
