Homes expo to the rescue of real estate

By IMMACULATE WAIRIMU immawairimu@yahoo.com AND ALLAN OLINGO aolingo@ke.nationmedia.com, May 15  2013  

 

In Summary

• This is particularly important as the exhibition will be staged amid reports of fallen sales, stalled constructions, and stagnated rents. This has happened because towards the end of last year, stakeholders were unsure of the political climate that would emerge after the elections in March. Many of them held back, according to the event founder and organiser, Mr Daniel Ojijo.
• The exhibitors will include professionals drawn from service providers and sellers from the financial sector, insurers, energy suppliers, residential and commercial property developers, industry associations and government bodies, property valuers, constructors, development consultants, entertainers, interior decorators, travel, and leisure.

The 17th edition of the Kenya Homes Expo opens its doors from May 23 and runs through May 26. It will be officially opened by Nairobi governor Evans Kidero.

The Kenya Homes Expo has been running for eight years and has grown to become one of the largest housing forums in East and Central Africa, where industry stakeholders meet on one platform twice a year.

The coming edition will run under the theme, “Aiming Higher”. The focus is to generate higher sales and to attract a larger prospective customer pool as more exhibitors express an interest in the expo.

This is particularly important as the exhibition will be staged amid reports of fallen sales, stalled constructions, and stagnated rents. This has happened because towards the end of last year, stakeholders were unsure of the political climate that would emerge after the elections in March. Many of them held back, according to the event founder and organiser, Mr Daniel Ojijo.

“The first quarter of 2013, especially in the run-up to the elections, saw house prices stagnate across most developments, with only standalone houses recording a slight price rise of 1.2 per cent and town houses and apartments recording a 1.5 and 0.2 per cent decline in prices,” he says. The statistics are according to the Hass Consult first quarter report for 2013, which says the rents for standalone houses saw a 2.1 per cent rise. Generally, the report indicates, potential customers adopted a wait-and-see stance in the wake of the highly charged political climate.

The biannual four-day Kenya Homes Expo is scheduled for the Kenyatta International Conference Centre.

The East Africa Portland Cement Company will be the title sponsor, with the Standard Chartered Bank, Hotpoint Appliances, and Wananchi Group as the Gold sponsors, says Mr Ojijo.

The expo has come of age since the maiden forum in 2005 when about 40 exhibitors took part. More than 130 exhibitors have confirmed their participation in the May edition.

The expo is expected to be the largest in the history of the event, with the organisers having already taken up the Tsavo, Aberdare, and Lenana halls and the courtyard at the KICC to meet the demand for space, according to organisers.

The forum may be popular this year because it is an opportunity to re-energise real estate buying, financing, and development consulting, and generally to bring the industry back to life, according to Mr Ojijo.

Indeed, if the story of Ms Anne Njeri speaks for many, then the expo has a way of inspiring activity in the housing and property market. Ms Njeri, 36, became a developer in Ruai in the outskirts of Nairobi after attending the October 2012 edition of the Kenya Homes Expo.

Out of curiosity

“I saw the advertisement of the October 2012, expo on television and decided to visit out of curiosity to see what goes on there. Surprisingly, I got more than I had anticipated. There were not only developers and agents, but also varieties of construction materials and home appliances, most of them at discounted rates or with offers.

“It was just amazing to see how much Kenya has to offer in housing, leisure, and home design options, which I wouldn’t have know about had I not attended the expo that brings together many stakeholders,” says Ms Njeri.

She adds: “I had heard and read about upcoming mini-cities, golf estates and resorts, but the expo gave me an exclusive opportunity to be among those who have seen their designs from the inception stage, though only on paper.”

Inspired, Ms Njeri, who had in the year before acquired a half-acre plot in Ruai but had only used it for small-scale farming, developed ideas.

“I was also able to talk to different mortgage lenders and learnt that what I had heard people say about mortgages were mostly half-truths. It was just awesome, as I did not only come out of the October 2012 expo with a house design and interior for my house, but with a whole wealth of real estate information and the necessary contacts,” she explains.

The organisers say that they expect about 40,000 visitors this time, up from the 30,000 who attended the April 2012 edition. “We have upped our marketing to ensure that the exhibitors interact with a large number of potential buyers,” says Mr Ojijo.

The exhibitors will include professionals drawn from service providers and sellers from the financial sector, insurers, energy suppliers, residential and commercial property developers, industry associations and government bodies, property valuers, constructors, development consultants, entertainers, interior decorators, travel, and leisure.

A number of international firms have confirmed participation for the October edition, including corporations from China, Germany, Turkey, India, and South Africa.

“Most of these international companies came in after the peaceful conclusion of the elections,” Mr Ojijo clarifies, adding that the organisers moved the expo from the usual month of April to May ao allow the political temperatures to cool down.

Since its launch in 2005, the Kenya Homes Expo has generated thousands of sales leads and assisted hundreds of investors who, after acquiring necessary market information, have come up with multimillion projects, according to the organisers.

Hotpoint Appliances Limited is one such exhibitor. Its showroom manager, Ms Ritu Magon, whose firm exhibited in the home appliances category two years ago, has expressed interest in participating this year after getting requests from customers. She says the large number of potential buyers visiting the expo drives the company’s interests.

“Apart from reaching out to a mass market, we managed to sell a number of appliances to targeted consumers,” Ms Magon says.

Studies show that information gaps are the biggest factor holding back potential investors and customers, who treat home ownership and construction as long-term projects requiring extensive research.

Kenya Homes Expo intends to bridge the knowledge gap and deliberate on the challenges that the local housing market faces in a bid to close the yawning deficit, which currently stands at an annual demand of 250,000 housing units against a paltry supply of just over 60,000.

“This makes the expo an important ingredient to the on-going efforts to increase Kenya’s annual production of housing to over 200,000 in the medium term,” says Mr Ojijo.

“We take it as our duty to connect the sellers and the buyers in the property market. A growing economy has a demanding consumer market and buyers have the ability to spend. Thus, the expo aims to bring the industry players under one roof so that they can meet one-on-one to share information on these vital issues,” he adds.

Visitors to the show will be charged Sh150 for entry, up from the earlier Sh100. The organisers argue that the charges are to ensure that the four-day event attracts only people who are truly interested in the products and services on exhibition.

The other local homes expos include the Property and Auto Expo, the Mombasa Homes Expo, the Elegant Homes Expo, The Kisumu Homes expo, and the Kitengela Homes expo.

Kenya and the other East African countries are grappling with the challenges of housing supply amid increased investor participation.

The existing developers mainly target the top end market, neglecting low income earners who are unable to take up mortgage due to the exorbitant interest rates or low wages.

Low-cost infrastructure bonds

The managing director of The Mortgage Company, Ms Caroline Kariuki, says that to provide affordable home ownership, developers should be given incentives, including low-cost infrastructure bonds.

“Slightly over 20 per cent of the annual housing demand in Kenya is currently on supply with the intensified government and private sector operators now aiming to improve on the national housing deficit. Equally, mortgage financiers have increased their marketing of funding schemes, resulting into an increased uptake of mortgage services,” she explains.

“A growing economy has a demanding consumer market and buyers have the ability to spend. So Kenya Homes Expo aims to bring the industry players under one roof so that they can meet face to face to share information on these vital issues,” says Mr Ojijo. “We take it as our duty to connect the sellers and the buyers in the property markets.”He adds: “The expo has always provided a platform that was primarily lacking in the real estate market. We are proud to give an avenue where the information on real estate opportunities is readily dispersed. And with the positive uptake by exhibitors, we can only expect the expo to continue growing.”