Agents doing booming business in counties

Agents doing booming business in counties

Not long ago, Ken Omari, a landlord with residential houses in Kisumu and Kisii towns, resorted to using estate agents to collect rent on his behalf. He took this action after it became difficult for him to do it himself.

“I realised that travelling all the way from Kisumu to Kisii to collect rent from a single tenant was not cost-effective. Most of the time, I would find the doors closed and ended up wasting the entire day,” he says.

But even when he found the tenants, most of them still ended up giving him empty promises. At times, he would also not make it to Kisii on the agreed date.

He decided to approach a real estate agent firm in Kisii town, which has since been collecting rent on his behalf from all the 20 tenants, and ensuring that they are deposited into his account.

And the result has been impressive: Collection now stands at over 90 per cent, up from 60 per cent when he used to do it himself. He pays a 15 per cent commission.

He attributes the success partly to the fact that unlike him, who would at times be convinced by some tenants to extend the rent payment deadline, the agents are professionals doing their job and tenants find it impossible to ask for an extension.

Long considered the preserve of major towns like Nairobi, Mombasa and Kisumu, estate agency is now catching on even in smaller towns across the country.

It is being fuelled by the recent growth of real estate in the counties where the demand for new housing has been rising to accommodate county staffs.

The rise in the number of residential houses in these places means that property owners, especially those with many houses to let, can no longer go personally from door-to-door to collect rent from tenants.

Change

Dave Wasonga of Victoria Investment Company, a real estate development firm with residential houses across the country, says they realised that they could not collect rent while at the same time carrying on with their core business: building houses.

“We realised that as the number of houses increased, collecting rent was becoming difficult. This was compounded by the distances between the towns where the houses are located,” he says.

Eventually, the company decided to hire a Kisumu-based firm to collect rent for them and manage all their houses. Apart from the decrease in the number of rent defaulters, Wasonga says the agency has also been of immense help as it also handles tenant complaints.

Tom Shikuku, a housing agent based in Kisumu, says he ventured into the business by default. He had just competed Form Four and was still waiting to join college when a neighbour, who had two blocks of residential houses in the town, approached him and asked him to be collecting rent on his behalf while he was away.

“At first, I was not very keen on the job for I had set my mind on going to college and doing a degree course in hotel management. However, I decided to do it for just a few months before joining college,” he says.

Little did he know that this would end up being a full-time job. He took up the job and did it quite well. Soon, he was approached by another landlord who had been referred to him by the first one and who also wanted him to help in collecting rent for a few houses.

It was then that the idea of starting his own property agency dawned on him. Today, he has over 10 clients he collects rents for. Besides, he ensures that the houses are well maintained.

And it is not just his agency alone. Real estate agencies are nowadays found in even some of the smallest towns as landlords find it easier to leave the task of collecting rent and managing their buildings to the agents.

However, just like in any other business, the growth of property agency has come with challenges, the main one being lack of professionalism in the field.

Unruly agents

There have been reports of unruly house agents harassing tenants, with some even evicting them after disagreements. Others have also been known to charge the tenants much more than the amounts recommended by the landlord.

And while acknowledging that some of the agents have not been ethical in the way they do their business, Shikuku says the industry is still growing and the agents are learning on the job.

“It is important to note that nearly all these agents lack professional training. This means that unlike other careers, with real estate, one learns on the job,” he says.

To practise as an estate agent, you must be registered by the Estate Agents Registration Board and the Institution of Surveyors of Kenya (ISK), which is the professional body for estate agents, valuers and land surveyors.

However, the business has been infiltrated by people who don’t have professional qualifications, otherwise referred to as quacks.

According to Victor Olonde, ISK’s coast branch secretary, the professional body has launched a training exercise for agents like Shikuku, who have experience but lack professional training. After training, the agents will then be absorbed as affiliate members of ISK.

As a professional body, ISK is more concerned about ethical and welfare issues among its members, not policing matters. That means it has no powers to take action against those not registered with it or errant agents.

Olonde advises landlords to only deal with duly registered agents to ensure that their properties are professionally managed.

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