Banks, pension schemes top finance sources for real estate - 4 months ago, 11 Oct 08:25
Bank loans and retirees’ savings remained the largest finance sector source of funds for property developers and homebuyers in 2017, fresh statistics show, amid declining average house sales and rent prices.
Commercial banks increased their investment in real estate by Sh87.56 billion last year, the highest allocation in a single year, despite the September 2016 legal ceiling on loan charges.
That brought banks’ total loans in the sector - whose growth slumped to a six-year low in 2017 - to Sh371.65 billion, data from central bank’s stability report shows.
However, despite a 30.82 per cent growth in financing from lenders last year, CBK notes that backing for real estate has continued to grow outside the banking sector.
“While Saccos have focused on funding land purchases and construction of residential houses for their members in urban areas, through investment units, local pensions institutional funds like National Social Security Fund ...
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