Understanding The Costs And Benefits Of Owning A Home

Real Estate
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Have you ever dreamed of owning your own home? It’s understandable why – there’s a certain pride in having unfettered access to a place that you can call your own. But what exactly does the Kenyan real estate market entail, and what are some of the costs and benefits associated with buying a home? Find out in this article, which explores Kenya’s real estate market and helps to shed light on the process of owning a home.

Overview of the Kenya Real Estate Market

Kenya’s real estate market is still young and undeveloped compared to most other countries in the world. However, there are many benefits to owning a home in Kenya. The cost of living is relatively low and the climate is excellent. Kenya also offers a great lifestyle with plenty of opportunities for outdoor activities. The downside of the Kenyan real estate market is that it can be difficult to find reliable information about properties and prices can be volatile.

Key Factors to Consider when Buying Property in Kenya

Now that you know the basics of Kenya’s real estate market, here are key factors to consider when buying property in Kenya:

  1. Location: The location of the property is important, as it will affect things like commute times, access to amenities, and schools in the area. Make sure to consider your needs and wants when it comes to location.
  2. Budget: It’s important to have a realistic budget when purchasing a property. Keep in mind the costs of things like stamp duty, legal fees, and renovation costs. It’s also a good idea to have a bit of a buffer in your budget in case unexpected costs come up.
  3. Property type: There are many different types of properties available on the market, from apartments to villas. Consider what type of property would best suit your needs. If you have a family, for example, you might want more space than what an apartment can offer.
  4. Size: The size of the property is another important factor to consider. Make sure to pick a size that is comfortable for you and that falls within your budget.
  5. Condition: When looking at properties, pay attention to things like the condition of the roof and windows, as well as any cracks or damage that may be present. These repair costs can add up quickly, so it’s important to factor them into your budget.

Cost of Owning a Home in Kenya

The cost of owning a home in Kenya depends on a number of factors, including the location of the property, the size of the property, and the type of property. The average cost of a home in Kenya is approximately KES 8 million (US$ 79,000).

There are a number of costs associated with purchasing a home in Kenya. These include the purchase price of the property, stamp duty, legal fees, and estate agent commissions. Stamp duty is a tax that is payable on the purchase of property in Kenya. It is calculated as a percentage of the purchase price and ranges from 1% to 5%. Legal fees are typically charged at 1% of the purchase price. Estate agent commissions are typically 2% – 3% of the purchase price.

In addition to these costs, there are also a number of ongoing costs associated with owning a home in Kenya. These include mortgage interest rates, insurance premiums, property taxes, and maintenance costs. Mortgage interest rates in Kenya are currently around 10%. Insurance premiums will vary depending on the value of your home and can range from KES 2,000 (US$ 19) to KES 20,000 (US$ 195) per year. Property taxes are levied at 0.5% – 1% of the value of your home each year. Maintenance costs will also vary depending on the size and condition of your home but can range from KES 10,000 (US$ 97) to KES 100,000 (US

Benefits of Investing in Real Estate

There are many benefits to investing in real estate. One of the most obvious benefits is that you can build equity in your property. As your property appreciates in value, you will have a valuable asset that you can sell or use as collateral for a loan.

Another benefit of owning real estate is that you have the potential to generate rental income. If you purchase a property with the intention of renting it out, you can bring in extra money each month to help cover your mortgage payments or other expenses.

Real estate can also be a good hedge against inflation. While the cost of living tends to increase over time, the value of real estate typically increases at a faster pace. This means that your investment can grow while still providing you with a place to live or work.

Finally, investing in real estate can provide you with significant tax advantages. The interest on your mortgage and any appreciation in the value of your property are both tax-deductible, which can save you a lot of money over time.

Mortgage Options available in Kenya

There are two main types of mortgages available in Kenya: commercial bank financing and SACCOs. Commercial banks offer a wide range of mortgage products, including fixed-rate mortgages, variable-rate mortgages, and Islamic finance products. Saccos are savings and credit cooperatives that offer lower interest rates than commercial banks but typically require a higher down payment.

The amount you can borrow and the interest rate you’ll pay will depend on a number of factors, including your income, employment history, credit score, and the value of the property you’re looking to purchase. It’s important to shop around and compare different mortgage options before making a decision.

Fixed-rate mortgages are the most popular type of mortgage in Kenya. They offer stability by locking in your interest rate for the life of the loan, typically 15 or 20 years. This means your monthly payments won’t change even if market interest rates rise. However, it also means you may end up paying more in interest over the life of the loan if rates fall.

Variable-rate mortgages have monthly payments that can go up or down depending on changes in market interest rates. This can make them riskier than fixed-rate mortgages, but they often come with lower initial interest rates which could save you money in the short term.

Islamic finance products are based on principles of Shariah law and comply with religious restrictions on lending money for profit. These products typically have higher initial interest rates but offer protections against fluctuations in the market

Tips for Finding Suitable Housing in Kenya

The process of finding suitable housing in Kenya can be daunting, but there are a few tips that can help make the process easier. First and foremost, it is important to have a clear idea of what you are looking for in a home. This means thinking about things like location, size, and type of property. Once you have a good understanding of your needs, it is time to start looking for properties that fit those needs.

One of the best ways to find suitable housing in Kenya is to use an online search engine like Google or Yahoo. This will allow you to see a wide variety of properties that are available in Kenya. Another option is to use a real estate agent. They will be able to show you properties that meet your specific criteria.

When looking at homes, it is important to keep in mind the cost of living in Kenya. The cost of living can vary greatly depending on the area you live in. For example, homes in Nairobi will generally be more expensive than homes elsewhere in Kenya. It is important to factor this into your budget when considering different properties.

Once you have found a few potential homes, it is time to start visiting them. This will give you a better sense of the property and whether or not it would be a good fit for your needs. After looking at several different homes, you should have a good idea of what you want and where you want to live in Kenya.


Buying a home in Kenya can be an exciting and rewarding experience. With the right information, you will know what to look out for when it comes to the costs and benefits of owning a home in the country. We hope this article has given you some insight into Kenya’s real estate market so that you can make an informed decision on how best to proceed with your own property search. Good luck!