Real estate firm Mi Vida Homes has launched an affordable housing project in Garden City, featuring 600 studio apartments whose selling price starts from Sh2.8 million.
This is the third project by the property developer at Garden City, which is a 47-acre mixed-use development.
“We are introducing a new project called 237 Garden City, which when fully done will be around 600 apartments,” said Samuel Kariuki, chief executive at Mi Vida Homes.
“This is an affordable housing project comprising studios one and two bedrooms and their starting point is Sh2.8 million.”
The project is valued at more than Sh1.6 billion, going by the indicative prices of the houses.
The three developments come on the back of the developer completing Mi Vida at Garden City — its first and flagship project in the complex comprising 221 units that were completed in July.
“We have started selling this project 237 which — together with Amaiya — we expect to break ground around April next year,” said Mr Kariuki.
Amaiya is a mid-market offering one and two-bedroom duplexes instead of standard construction.
The affordable project targets first-time home buyers as well as investors who buy such units and hold them for both rental income and capital gains.
The government and private sector players are investing heavily in affordable home projects in towns and major cities in response to increased urbanisation and population growth.
Private investors previously focused more on mid to high-end developments, pricing out the majority of households who have been forced to rent.
Mi Vida is a joint venture between private equity firm Actis and Indian construction company Shapoorji Pallonji Real Estate, both of which had committed Sh12 billion for the firm’s housing development with additional funds in the form of debt and customer deposits.
The real estate business is attracting more institutional investors who are implementing large-scale projects in major cities and towns.
Most of the units developed are one to three-bedroom apartments, targeting the middle class who have been priced out of the centrally located properties.
Official data from the Central Bank of Kenya showed the average mortgage size increased to Sh9.2 million last year from Sh8.5 million previously, locking out low to mid-income workers from a market of 26,723 home loan accounts.
The latest data from HassConsult also shows that the value of all properties in Nairobi and satellite towns grew by an average of 10.3 per cent in the year that ended September.
Apartment prices however contracted marginally in the quarter that ended September compared to the preceding quarter, signalling that sellers in the highly price-sensitive market were showing more flexibility in accepting negotiated asking prices.