homeownership

Three in every ten new homeowners who walked into Stanbic Bank to buy their first mortgage were women.

Kenya which is still paternalistic when it comes to who builds and owns a home is being swept by changes especially as houses become more than just homes, but high value appreciating assets.

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Stanbic bank, in its Sustainability report, said that as of 2019, 78 per cent of all mortgages issued by number were to first-time homeowners, 30 per cent were issued to first-time female homeowners.

By value loans issued in 2019 equated to nearly half of the order book at 45 per cent, with 17 per cent of the value being issued to first time female homeowners.

Ms Chikka Yambo said she had always wanted to own a home, an apartment to be specific but knew the process was costly and not easy.

First she needed to secure the 20 per cent deposit to book her apartment, this was not easy.

She borrowed some money from Stanbic as an unsecured loan and the remainder from a friend, a loan which she had just cleared under stressful circumstances.

Stanbic also required me to pay a “Commitment Fee” so she also had to borrow money to secure my letter of undertaking. It has been painstaking but worth the hustle.

“Before the 105% mortgage product was launched by Stanbic Kenya, and with reduced loan interest provided, I struggled for 4 years to qualify for a mortgage. The 105% financing enabled me to pay for costs such as legal fees, stamp duty and requisite deposits which are part of my sales agreement with the property developers,” Ms Yambo said.

“I would have had to borrow more money from other sources if the 105% financing was not an option or worse still, I may not have had the opportunity to buy my apartment at all,” she said.

She represents a new class of women whose venture into real estate as home owners may transform the country’s small mortgage market.

Kenya’s banks are still the main providers of mortgage financing with 77.5 percent of all mortgage lending originating from only six banks out of 43 financial institutions in the country.

Most financial institutions are reluctant to expand their mortgage portfolios because of limited access to capital markets and collateral requirements which make mortgages exceedingly expensive.

This explains the number of registered mortgage loans standing at only 26,187 in Kenya as of December 2017.

It is estimated that Stanbic Kenya serviced 16 per cent of the mortgages financed by the banking sector in 2017.

Stanbic strives to ensure growth in mortgage loans on offer with a focus on the provision of products aimed at making first-time homeownership possible.

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