Factors Derailing Real Estate In Kisumu From Achieving Maximum Potential
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Real estate in Kisumu has come along way in terms of the role of real estates in economic development in the lakeside region. Real estate has contributed a lot to economic development for instance by creating employment to Kenyan citizens as well as contributing to the development of other sectors of the economy such as transport sector, tourism, business and the agricultural sector.

However, real estate in Kisumu is still facing a number of challenges in its quest to provide modern and affordable housing to the residents of Kisumu County. These challenges include;

• Inadequate government incentives- The incentives provided by the government are not sufficient enough to make housing affordable to the lower income group where the demand is high and the supply is low and very critically needed. The government should increase its budgetary allocation as well as source for more funds from its development partners to assist in providing the cash needed to stimulate the of affordable houses to meet the growing demand.

• Housing demand- Real estate in Kisumu is currently facing a huge housing deficit whereby the demand for houses, especially low cost houses is quite high in comparison to what real estate developers can provide. The poverty index in Kisumu is so low such that majority can not afford the cost of the available houses.

• Lack of title deeds- Some lands and properties in kisumu have no title deeds or any authentic documentation to prove ownership. This makes it hard for real estate companies to sell such properties to any investor as the investors are wary of such properties. Such properties may end up with endless court battles that are time consuming and one may even lose money in the process.

• Land regulations- The recently introduced land regulations have made theland acquisition process more cumbersome and tedious. This makes investors to opt for other forms of investment as opposed to buying land or property.

• Some people in areas like Manyatta estate, Obunga, Nyamasaria and even Migosi estate own traditional lands where no meaningful structures have been constructed. Some have mud structures erected on them. The owners of such lands are usually never willing to sell these lands and this greatly hinders the development of real estate in Kisumu.

• High inflation rates also affect the development of real estate in Kisumu. This makes the pricing of houses to shoot up to impossible rates making purchase of property an uphill task for investors. While it can be beneficial to the seller, it can also backfire as investors might decide to shun buying of property all together leaving the seller counting losses. High inflation rates also passes down directly to real estate companies because when inflation rates rise, the cost of most commodities go up including the cost of building materials. This is incurred by the real estate companies making construction of buildings more expensive.

Such challenges make investing in real estate in Kisumu a herculean task for investors. The government should therefore come in and intervene where possible.


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