When we started selling land to potential homeowners in 2010, we didn’t imagine our business would take us to so many parts of the country. We started with six acres in Konza, which we sub-divided and sold to individuals. We have since bought, sub-divided and sold hundreds of acres in Lamu, Nanyuki, Mpeketoni, Aberdare, Nakuru, Rumuruti, Kikopey, Rongai, Kitengela, Isinya, and Oletepesi, just to mention but a few places. Currently, we are on our 36th project.
One of the things that have struck us most is the role the devolved system of government or counties has played in our business. When we started seven years ago, the country was administratively divided into provinces and districts. The 2013 General Election ushered in the devolved system under a new Constitution, creating counties that operate with reasonable levels of autonomy. For us – and I believe other real estate players as well – counties was godsend.
Devolution has opened up formerly remote areas for development. We now have roads, power lines and sewer lines where none existed for years. The opening up of these places has increased the demand for land and housing as people move in to do business in these former outposts. This has led to unprecedented level of construction activity in “rural towns”.
I believe that the days of Nairobi as the investment hub of choice are gone. With devolution, it is not far-fetched to say that the best places to invest are those outside Nairobi like Laikipia. One reason we hardly sell property in Nairobi is that prices are out of reach for the middle-class, who are our target group. Unfortunately, many people are still fixated with the idea of buying a house in Nairobi. They say houses are too expensive in the city yet fail to appreciate that opportunities are outside Nairobi.
One of the shocking trends we have witnessed is that people prefer buying property where they have never been. Most of our Mt Kenya properties were bought by people from Western Kenya and Nyanza. Most plots in our Mpeketoni project were bought by people from Central Kenya.
Konza City to gobble up Sh200b
I think this idea of “there is an ocean and I don’t see ocean where I come from” draws people or “there is a mountain so let me go see this mountain”. I think Kenyans are more cohesive than is often portrayed in the media.
Do buyers care where the property is located as long as it is outside Nairobi? They do. People want progressive counties. Go to Machakos County today and ask property prices. They have gone up. Why? Because Governor Alfred Mutua has put up lights, built tarmacked roads, given people ambulances, and ensured there is security. Everyone now feels comfortable living in Machakos. That is the same case with Nakuru that lately been developing pretty fast and demand for property is very high.
In about 10 years, it would not matter who becomes president. What would matter is who your governor is.
– The writer is the Group CEO of Property Reality Company (PRC).