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Government must regulate real estate industry to protect ordinary Kenyans

UREPORT
By Joe Musyoki | April 9th 2017

Rogue real estate developers are threatening the dream of Kenyans to own a home. It is unfortunate that the government has been a spectator as semi-illiterate, sweet talking callous real estate developer collects funds from unsuspecting Kenyans, with promises of building them homes, only for the monies to end up lining individual pockets.

The government must now put its foot down to bring sanity to the real estate development industry by crafting and enforcing a water tight legal and regulatory framework that protects prospective house owners, ensures adherence to building standards and observes timelines indicated in the prospectors. The government should also audit such projects to prevent further agony. Stakeholders should ensure all developers demonstrate financial muscle to develop at least 25 per cent of the proposed project before obtaining approval. The track record of the developers must be evaluated to weed out fraudsters!

Even though this may be detrimental to upcoming developers, the interest of the public must come first and the future of the industry safeguarded.

To guard against diversion of funds, real estate developers must make regular reports authenticated by independent institutions such as National Construction Authority and hold compulsory meetings with investors.

The function of buying land and the real estate development should be separated as most developers are biting more than they can chew; selling land and building houses at the same time contributes to conflict of interest.

All funds collected should be held in an escro account with ministries of Housing and cooperative as some of the signatories and money released in stages against work done. The government should recover monies the public has lost through such pyramid housing schemes.

These developers must obtain bank guarantees so that in the event the project collapses, funds collected are refunded to contributors. Professionals involved in such theft should be censored.

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