The growth of the construction sector has lifted the demand for building materials such as roofing sheets and cement.
Data from the Kenya National Bureau of Statistics (KNBS) shows the production of galvanised sheets rose 2.4 percent in the seven months to July to 152,169 tonnes from 148,663 tonnes a year earlier.
July had the highest production of roofing sheets at 23,930 tonnes.
Meanwhile, the demand for cement rose in the nine months to September by four percent to 7.34 million tonnes from 7.33 million tonnes the year before.
In Nairobi, the value of buildings approved for construction in the nine months rose 18 percent to Sh142.8 billion from Sh120.8 billion in the same period last year. Most of the building plans were approved in April at Sh20 billion, and the lowest value of Sh5.6 billion was approved in May.
Residential buildings contributed 77 percent of the value of buildings approved in Nairobi, indicating higher demand in this space compared to commercial properties.
The growth in the sector comes despite the high cost of materials, including steel, in an economy where inflation has been driven by local and international factors, including the depreciation of the shilling against hard currencies led by the dollar.
The average construction cost per square metre in Kenya this year rose to a range of Sh41,600 to Sh100,800, according to construction project management firm Integra.
“When converted, those building rates translate to Sh3,865 per square foot to Sh9,365 per square foot. Sh41,600 is the average cost of building one square metre of a standard bungalow in Nairobi and Mount Kenya region. It represents an increase of 20.06 percent over the past year,” said Integra.
The same would, otherwise, cost Sh43,250 per square metre in the Coast region, while developers in western Kenya and Nyanza would have to fork out Sh42,000 per square metre.
“This, respectively, is 19.31 percent and 13.98 percent more than you’d have spent at the beginning of 2022,” said Integra.
Some of the demand for building materials is from affordable housing projects backed by government incentives.
Investors building affordable housing that put up at least 100 residential units annually are entitled to a reduced corporate income tax rate of 15 percent for that year of income.
