Kenya: Country Loses Shs 100b in Real Estate Alone
January 22, 2008
The highest loss reports following unrest in Kenya has been noted in the real estate sector where a whooping Sh100 billion could have been lost.
According to a fresh release last week, the losses accrued from looting and property destruction in residential, commercial and industrial areas.
The loss is also attributed to the plummeting of the value of real estate properties like houses and offices following security fears around the country. According to figures released by the Institute of Surveyors of Kenya (ISK), the sector is headed for tough times ahead as loss of confidence takes its toll on the East African country.
ISK chairman Mwenda Makathimo said most of the losses could have been avoided if government had formulated a revised national land policy.
According to Makathimo ethnic hatred is as a result of glaring inequities in land allocations in the country that took effect immediately after the country attained independence. “As a sector, we are counting losses in excess of Sh100 billion in the skirmishes. We feel the election results were just the ignition point but most of this fighting has to do with the land inequities in the country,” he said.
Addressing a press conference at their, offices in Nairobi, a new land policy and far reaching constitutional changes could save the country from future turmoil and ensure economic stability.
“In a business dictated by the forces of demand and supply like ours, a minute of insecurity translates into massive losses in value,” said Makathimo. Players in the real estate industry have long adapted to using their properties as loan collaterals, however, the chairman said most loaning institutions will be reluctant to accept this.
He said the institutions were citing the plummeting property values as the reason for denying them loans. Also decried was the wide spread loss of employment opportunities for thousands in the construction and real estate sectors as a result of the insecurity in the country.