Kenya. Banks, pension schemes top finance sector sources for real estate funding
Funding options in Real Estate (Sh billion)
Banks’ credit to the real estate grew by 30.82 percent in 2017 compared with 18.33 percent growth rate for pension funds.
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.
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