The economy of Africa has seen leaps in the past few decades attracting tonnes of investments in the fields of energy, petroleum, infrastructure, real estate and what not. This of course has had a huge positive impact by providing employment. But it also came with the rapid increase in demand and prices in the housing sector which has now rendered most part of prosperous places practically unaffordable to many.
Just when majority of investors and developers had no interest in the sector, Karibu Homes changed the perception. Karibu Homes is a private affordable housing development firm which not only managed to pool investments for their truly affordable housing projects assisting a huge number of middle-low income families so they can live in decent and happy homes in a thriving community, but
also showed profits on it, making it an ideal case of win-win social entrepreneurship. This coupled with over 60% of their buyers being owner-occupiers shows that there is thirst for home ownership from this underserved sector.
A quick chat with the Managing Director of the company, Mr. Ravi Kohli gave us some insights that we would like to share with you hoping it inspires you as much as it inspired us.
What is the best thing you love about your job?
I love the fact that though we work for profit, our venture has a positive social impact and we work in a sector where the demand highly outstrips the supply.
What were you initial setbacks as an entrepreneur?
The main difficulty was the fact that people didn’t believe in our vision or our work. So it made it very challenging to find funds for the project.
What are your setbacks now? How much have things changed in all these years?
The chief setback now is the fact that for a lot of low & middle income Kenyans, it is difficult to qualify for mortgages and even if they do, the high interest rates and smaller tenures result in them not able to afford the mortgages to buy low-cost houses.
But things are changing for good. With the government prioritizing housing and the interest rates getting stable, future looks positive. The formation of the KMRC (Kenya Mortgage Refinance Company) is a very positive move in the right direction for off-taker’s
What are the key aspects that are generally overlooked in this sector?
I would say serviced land with good infrastructure, their sky-rocketing prices and the cost of transaction. Buying property in Kenya has prohibitively high closing costs – almost at 10% of the value of the purchase.
How do you see this sector in 10 years from now?
In 10 years I think we would have built a lot many affordable houses as a nation, hoping the policies also would favour more development.
Why is it important for investors to push this sector?
Because this is a scalable venture with good ROI and now with government support, it is quite lucrative to invest in this sector.
What value can events like AHIS add to the sector?
Events like AHIS help understand opportunities in terms of information shared and connections made. It helps motivate people to work in this sector.
What will be your delivery at this event?
I intend to present a case study about our story and success along with some data on what prospects exist in the sector.
With this, we thank our Advisory Board member Mr. Ravi Kohli for his active involvement in the Affordable Housing Investment Summit Africa, 2019 scheduled for 26 th & 27 th June at Radisson Blu Hotel, Nairobi, Kenya.
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