UK-based company seeks to help Kenyans acquire property abroad

Kenya’s middle class and business people have turned to the UK to buy houses for renting out, mostly due to the high inflation in the country, that has made acquiring of Real Estate very expensive and mortgage rates very high.

In June, 2022, Kenya’s inflation rose to 7.9% from 7.1% in May, hitting a 58-month high on soaring prices of food items. This is according to the Kenya National Bureau of Statistics.

This is the first time the upper limit target of the Government, which is 7.5%, has been breached since August, 2017. The disruptions caused by the war in Ukraine has largely contributed to this. Inflation distorts citizen’s incentive to save, invest ad work.

Buying of property locally has therefore been largely affected. This is due to the rise in prices for building materials, which consequently make construction expensive.

In 2021, economists at the East Africa Property Summit agreed that Real Estate in the region would be unlikely to see a rise in demand. Moses Lutalo, the Managing Director of Broll Uganda, which is a property service company, lamented that the demand for commercial office space had been down for 12 months, while the demand for rentals remained very low, especially in Kenya.

By May, 2022, data by realtor HassConsult showed that the price for an average house within the city had risen by 6.8%. Moreover, land prices in Nairobi rose by a marginal 1.07 percent and recorded a jump of 7.35 percent in the satellite towns such as Kitengela and Juja. Since it is challenging and costly to buy property in a high inflation market, Kenyans are now finding alternatives to buying property in Kenya.

“Kenyan buyers are spending an average of 210,000 pounds (Sh30.7 million) on a house in Birmingham, Manchester, London, Liverpool, and Leeds in the UK” says Mark Pearson, Founder and Managing Partner for Baron and Cabot.

“Our company is getting a lot of interest from East Africa, and predominantly Kenya. The average purchase from a Kenyan client is 210, 000 pounds. Most are business people, and middle-class Kenyans, which is exciting. We are seeing a spike in a lot of younger middle class or upper-middle-class and not just the ultra-elite as they are aware the world seems to have shrunk a little bit.”

Among the markets that Baron and Cabot has in Africa, Nigeria is the most lucrative. Nigeria has one of the highest inflation levels and high mortgage rates. Baron and Cabot gets a very low mortgage rate for Nigerians in England.

The rates range between 4.5% and 4%. It can be a 25-year mortgage, and it is changed from every two and five years to get a lower mortgage rate. You don’t have to use cash to buy out the mortgage to change it, you just move from one to another.

Ghanaian investors are also exploring alternative investment. Pearson says that on an average, they record transactions of up to 5 million pounds in West Africa monthly, with bulk coming from Nigeria and a fair share from Ghana.

Investing in property in the UK is greatly considered to be one of the lowest risk investments in the world, with consistent long-term returns factored in by continuous growth within the country. Baron & Cabot has built a market leading research strategy for the investor to simply just choose what would be suitable for them.

The investor is also granted a step-bystep guide on sourcing the right property to purchase in the UK. This gives the investor the power and confidence to ask the right questions for profitable property investment.

“Our introduction in Kenya and Nigeria will greatly impact property investment and sourcing in the UK, thus creating more options for investors”, says James Walsh, Head of Sales at Baron & Cabot Research.