Unless you’re super determined and a smart saver, you may spend an entire lifetime in rented houses.
Of course, this isn’t the best scenario as you have other things to plan for including your retirement.
Luckily, you can still own a home inexpensively if you know how to save for a house in Kenya or by adopting one of the smart strategies I will highlight in this article.
Read on to discover how to own a home in Kenya before it’s too late.
How to own a home in Kenya – 5 smart plans
Here are some strategies to help you own a home without taking a mortgage in Kenya (remember that some institutions charge as much as 20% for mortgages!).
Rent to own schemes in Kenya (pay rent to own house)
Instead of just paying rent, you shift to one of the rent to own homes in Kenya- there are a number including one where the ‘rent’ is about shs.25000 and you eventually own the home after paying for the apartment for 10-15 years.
The requirement is that you have a regular income and you can choose a studio, one, two, or three-bedroom apartments in most cases.
The advantages of these types of home ownership savings plan include manageable risk (you’re paying for a house that already exists), flexible payment terms, and the convenience.
National housing runs an amazing tenant purchase scheme in Kenya and they have houses across the country and I recommend that you visit their website to get started.
There are also a couple of private developers offering rent to own apartments in Kenya including superior homes.
You might be required to make a down payment so it’s important that you have some savings.
How to own a home in Kenya – Target the outskirts or low-end properties
Developers like Koto Housing construct standard houses under 1 million in Kenya if you’re ready to live in the outskirts.
These companies use alternative building technologies to construct high-quality homes affordably.
There are also real estate investment firms advertising a 2-bedroom house at below shs.2000000, making them very ideal for beginners.
In fact, developers such as Moke Gardens even have low-end housing products going for as little as shs. 1500000 in areas like Lukenya area.
Save and build a 3-bedroom house at shs.850000
What about buying a plot in cheaper places like Kantafu (price is about shs.250000) then building a 3-bedroom home at shs.850000?
To do this, set aside at least 10% of your income and then save in a target bank account such as KCB target savings account.
Assuming that, you, for instance, save ksh. 10000 monthly, you will have accumulated ksh.120,000 in one year- enough to buy the plot.
Continue with the same trend and you should have about shs.1 million for the house in 6-7 years.
That should be way cheaper than buying a house on mortgage.
And it’s not a must that you buy at Kangundo road- there are inexpensive plots all over the nation.
Check with various land buying and selling companies in Kenya for available properties.
Join a home ownership Chama (or start one)
Another alternative to mortgages or buying a house in Kenya expensively is joining a chama or forming one with close buddies.
Let’s say you’re eight of you and each is contributing shs.10000 per month.
In a year, you’ll save nearly 1 million shillings and this amount can go to buying a 1-acre piece of land along Kangundo road or other places where land is not overpriced.
That equates to a 1/8-acre plot for each member.
Each of you should be a proud homeowner in about 10 years if you maintain the savings momentum.
It’s largely a lottery plan, but you can, with luck, still own a house in Kenya through the government- sponsored Boma Yangu affordable housing initiative.
The contributions start as low as shs.2500 per month and the good thing is that you can’t lose your money- you can request for your total deposits 15 years after your first contribution or on attaining retirement age, whichever comes earlier.
The first phase of the project at Ngara is already complete.
Who knows? You might be the lucky one!
The secret to owning a house before its too late is practicing an indomitable saving culture to help you save between 10-20% of your income.
Additionally, start a side hustle- if you can- and channel any extra income to your dream of owning a home.
Do this for any bonuses you receive from the employer as well.
But don’t strain yourself- start off with the amount you can afford to save and grow it gradually, as your income rises.
Lastly, the newly formed Kenya mortgage refinance company (KMRC) is expected to be a boon for Kenyans searching for cheaper mortgage financing and they could be worth checking.
Otherwise, that’s how to own a home in Kenya even when your pay is nothing to write home about.