Why Nairobians Prefer Buying a Home in Cash

The paper, which details the housing and infrastructure situation in the capital, one in every ten Nairobians owns a dwelling place.

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Jan 20, 2023 - 14:46
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Why Nairobians Prefer Buying a Home in Cash
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A recent report has revealed that most Nairobians prefer to either purchase a home or build a home using cash.

According to the discussion paper by a public policy think tank, the majority of individuals who own their own homes in Nairobi acquired the properties in cash, revealing the gap that exists in accessing affordable financing for home loans.

Among individuals who purchased their dwelling places, 66.7 percent did it cash while 16.7 percent through loans. Another 16.7 percent purchased homes with both cash and loans.

When it comes to those who constructed their homes, 80 percent did it in cash while 6.7 percent constructed through loans. Another 13.3 percent was constructed through loans and cash.

“This indicates that home financing preferred by the majority of households is construction and buying in cash.”

The paper, which details the housing and infrastructure situation in the capital, one in every ten Nairobians owns a dwelling place.

The Kenya Institute for Public Policy Research and Analysis (KIPPRA) paper notes that 91 percent of households in Nairobi occupy rented houses.

Only about nine percent of households in the city own their own houses. Additionally, it states that 53.7 percent of the owner-occupied housing units are mainly acquired through construction, 30.8 percent through purchase then 15.5 percent through inheritance.

The paper titled, Analysis of the Housing Status and Access to Basic Infrastructure in Nairobi City County: Disparities and Level of Deprivation note that “The preceding tenants characterize Kenya’s housing market. Therefore, affordable housing initiatives should also focus on homeownership and the affordable rental market for the population that prefers to reside in rented units.”

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