Kajiado county council freezes land subdivision
Olkejuado County Council has placed a blanket moratorium on the sub-division of land in its key urban centres as it seeks to control frenetic construction in a move expected to severely constrict supply of plots around Nairobi.
The council says that the rapid development of the area, largely a result of spill-over of population from Nairobi, was occasioning a planning nightmare as investors were leaving inadequate space for the development of basic infrastructure.
Among the emerging centres that will be affected by the directive are the construction hotspots of Kitengela, Ngong, Ongata Rongai, Kajiado, Isinya and Kiserian, which are the top dormitories for Nairobi’s middle-income class.
The mapping process projected to take “several months” is likely to slow down the initiation of new housing projects in the area, further dampening the growth in the real estate sector that is already reeling from high interest rates.
Charles Angira, the director of planning at the council, says the haphazard development of housing projects around the emerging towns exposes investors and home buyers to huge loss in property values owing to lack of infrastructure.
“We are very worried by the rate of development yet there is no basic infrastructure in most areas,” Mr Angira said adding that land dealers had failed to provide for basic amenities like roads.
He said that the council does not have exact timelines regarding lifting of the moratorium on land sub-division, which could mean huge inventories for land-buying companies and savings and credit cooperative societies.
“Most of the land transactions in Kajiado are through companies that acquire huge tracts and then subdivide it into plots for sale,” Mr Angira said.
The freeze is expected to have far-reaching reverberations in the real estate sector given the level of construction in the area, which is the main beneficiary of the biting house shortage in Nairobi, the capital city.
Experts in the real estate sector have cited the availability of affordable land and proximity to Nairobi as the main factors that have attracted thousands of people to purchase land to build homes in the Kajiado area.
The directive could also spark a new wave of property price hikes as a result of lower supply of land, breaking a short-lived reprieve that has lasted since mid last year when commercial banks tightened the growth of credit to the private sector to discourage borrowing.
As a result of the high interest rates, land transactions have slowed in most parts of the country as potential buyers suspend plans till the cost of credit eases.
George Ndirangu, the proprietor of Tinco Hardware, a building materials dealer in Kitengela observes that “business has been very slow” since last year, likely because of the limited access to credit for would-be customers.
An official from Soil Merchants, one of the land buying companies with operations in Kajiado says that the directive to freeze the subdivision of land is likely to stifle supply of development plots from the market, effectively slowing down construction.