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Building own home, a cheaper option for many

By | February 11th 2010

By Ferdinand Mwongela

Over the last few years the mortgage market has been growing steadily attracting more clients and raking in money.

This period has seen banks fight for a share of this lucrative market. This, however, according to Chris Chege, Head of Mortgage Finance at Co-operative Bank, constitutes a very small percentage of the housing construction sub-sector, with only about 25 per cent of the financing channelled towards it coming from the structured lending institutions.

Although it may be slow, it is often cheaper to construct a house rather than buying one.

The majority of Kenyans today have preferred to construct their own homes albeit in bits. They opt to become their own project managers and contract the actual construction to professionals under their control.

This self-construction is not limited to rural areas as many may imagine, but a good number of urban residents have also been opting for this, with many saying it is cheaper and has good results.

Statistics contained in the Vision 2030 document show that as of 2005, 20.4 per cent of Kenya’s population lived in urban areas. The number is expected to increase to 60 per cent by 2030 as the process of rapid urbanisation continues.

The Vision 2030 identifies affordable quality housing as one of the major problems facing the growing populations. This is an issue many of these people opting to put up their own structures point to. A pre-constructed three-bedroom modest apartment around the city costs around Sh6 to 16 million. As you move further away from the city, the cost drops down to about Sh3 million to Sh4 million.

Contrast this with those who opts to buy a small piece of land and put up a four-bedroom stand-alone bungalow for about Sh3 million to Sh5 million in a place like Kitengela and you have your answer. The Vision 2030 points out, and rightly so, that "80 per cent of new houses produced are for high and upper middle income earners."

Borrowing from SACCO

Those who go for this option say that apart from the quality, there is the question of financial capability. Jennifer Wambui says that she opted to build her own house as opposed to buying an already built one because of the costs. She said, with this option, she could do everything at her own pace depending on the availability of finances without stretching herself thin.

Wambui says she opted to join a Sacco from which she took a loan to start her off. "I buy the other materials one at a time and keep them," she says. When she had saved enough money, she called a mason for the technical part.

A house built using stabilised soil blocks, a cheap building technology.

Even those planning to build at some point in the future see building their own homes as the way to go, the nightmares (like the slow pace) along the way notwithstanding. Martin Gitonga a Nairobi resident says taking a mortgage or even buying an already built house is out of the question for him. His plan is to first buy a piece of land and put up a small house.

He then contends that with the money he saves from what was his rent, coupled with his own savings he should be able put up his own house slowly without having to mortgage himself to the hilt.

Gitonga says options like settling for a mortgage is good, but requires an already established individual who can afford to pay the huge monthly instalments.

Quality is assured when the owner is building for himself and his family and is unlikely to cut corners and put up shoddy structures, as is the trend now, leading to loss of lives.

Assured quality

Providers of alternative building technologies are also targeting this kind of developers in an effort to cut costs and house more Kenyans. Following the upsurge of new building technologies, the cost of putting up a house has considerably reduced and for as low as Sh300,000, one can have a home.

According to Dr Solomon Mwangi, the managing director of Construction Management and Consulting services (comac), one of the companies offering such options, little manpower is required with such technologies. Building using stabilised soil blocks is not very complicated and with a little training, individuals can operate the block presses themselves.

While launching a housing project using the structural insulated panel technology, Tony Gichuru, a director with Afrohomes, one of the companies that manufacture these panels, said this technology allows for more flexibility.

Homeowners can design their houses, "according to their personal tastes while using a technology that substantially cuts down the cost of housing". Karim Ghaidan, also an Afrohomes director concurred, describing it as a cost-effective way.

"They are strong, and quick to assemble," added Gichuru.

The Ministry of Housing has also continued to advocate for the setting up of alternative building technology centres around the country.

This is not, however, to say going solo is a smooth ride since there are different strokes for different people. One of the disadvantages associated with own home building is the pace of construction, especially if one does not have all the money required. It forces many to put up the structures in phases.

Slow pace

This slow stop and go construction means that in case of fluctuation in the prices of construction materials, the original budget could rise and end up taking longer than originally envisioned. The headache of managing the construction while at the same time tending to other duties or social commitments takes a toll on many who prefer to leave everything to a contractor.

Buying a pre-built house, however, means that there is very little room to adapt the structure to your own use. There is also the fear of over pricing of houses, clouding the market as developers rush to cash in on hapless Kenyans hungry for a place to call home.

However, going it alone means, saving on a developer’s and other costs, which translate to profit and more satisfactory outcome.

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