Frontpage Slideshow | Copyright © 2006-2010 JoomlaWorks, a business unit of Nuevvo Webware Ltd.
The Mortgage Company,
The Greenhouse, 2nd Floor
Adams Arcade, Ngong Road
P.O. Box 29310-00100, Nairobi

Tel: +254 729 933955, +254 737 933955
Email: info@tmcafrica.com
www.tmcafrica.com
WATCH TMC VIDEO

An independent mortgage brokerage firm has entered Kenya’s mortgage market with a view to deepening property ownership and mortgage uptake in the country. The Mortgage Company (TMC Africa), the first mortgage broker in East Africa, hopes to revolutionise the home ownership value chain and hopes to rope-in informal income earners to take up mortgages. The firm will provide all-round services to potential mortgages – individuals and businesses – while shopping for the best financing options available in the market. By acting as an intermediary, the mortgage broker will be better placed to negotiate for tailored products with financiers for home purchase or construction loans.

Its position gives it an edge to keep tabs on developments in the real estate market and capacity to provided mortgage information. Traditionally, banks and other lenders sell their own products but presence of brokers is likely to see them introduce competitively priced mortgage packages.
“Our role as a mortgage brokerage is to complement financiers at all levels. We aim to simplify the experience of home ownership by negotiating with financiers on behalf of the client,” Caroline Kariuki, TMC Africa’s managing director, told The Star in an interview. “Our loyalty lies with the customer and we are committed to ensure they get the best and most straightforward deal when acquiring property,” said Kariuki, who is the immediate former divisional director of mortgages at KCB S&L Mortgages. She has over 18 years experience in the mortgage sector.

The mortgage broker will find direct lenders on behalf of clients for specific mortgage loans at a fee while saving the client money and time taken to close deals. It will work closely with credit reference bureaus in carrying out debt scoring to establish the credit risk of borrowers, while advising on appropriate mortgage product. It will negotiate with financiers and handle structuring of deals. “Usually, the draw-down time for most projects is about two years from the time a client begins negotiations with financiers but we can cut this to about three months,” said Kariuki. She said the firm will partner with lenders to develop new mortgage products that suit different kinds of customers in the market. “We aim to exploit the life-time value of the customer – from right out of college to retirement. We’ll be offering more than just mortgage options. We’ll assess customer needs and advice accordingly.

“As an independent player, I can see the existing gaps and the pains customers go through. For instance, we need products for informal incomes and for SMEs. Also, most people may not know that they can take up joint-ownership mortgages. At some point, we may need to have reverse mortgages, foreign-denominated loans and refinancing options for individuals and companies,” said Kariuki. Kariuki said in the next stage, the firm will venture into mezzanine financing by providing a hybrid of debt and equity financing to developers wishing to expand their property investments. Equity financing could see it partner with insurers and pension funds, with the potential of reaping lucrative returns of well over 35 per cent of investment value. TMC has been in the market for four months and has already handled transactions worth over Sh1 billion for about 10 corporate clients. It’s currently targeting developers, high net-worth individuals and groups. It charges one per cent the value of the mortgage for its services, which can be as little as Sh50,000 according to Kariuki.


The firm aims to enlist at least one million mortgage accounts in the next five years. Kenya’s mortgage market is still small with a mortgage debt of 2.5 per cent to the GDP, distributed in about 16,000 outstanding mortgage accounts in 2010. “We wish to see more people choosing to invest in property than rent, and this will not affect the rental market,” said Kariuki. TMC will pay closer attention to the retail market (individuals) and will be holding mortgage clinics every weekend to tap the numbers. “Unless you give someone a key to unlock their potential, then you are not serving the needs of the market – that’s where the rubber meets the road for us!” she said. In developed mortgage markets like the UK, Canada and the US, mortgage brokers are the largest sellers of mortgage products for lenders.

Article source: http://www.the-star.co.ke/business/property/45280-mortgage-broker-forays-into-kenya

 
More Articles :

» Speech by Caroline Kariuki,Managing director of Mortgage Company on mortgage report in kenya

Speech by Caroline Kariuki,Managing director of Mortgage Company on mortgage report in kenya Caroline Kariuki, Managing Director,The Mortgage Company Thank you, Farhana, Ladies, Gentlemen, and members of the press, for your time and interest today...

» What happens to my mortgage repayments if I should be retrenched?

With the difficult economic times it is not surprising to be retrenched 2-3 times in your career. However, this should not stop you from owning a home. At TMC we have recently made innovations in our work with some insurance companies to develop a...

» HOW CAN I REDUCE THE COST OF MY MORTGAGE?

One of the biggest questions in every home buyer’s mind right now is How long can I continue to meet my mortgage payments? Developers are wondering whether they should continue with the projects and whether they will have takers for their...

» WHAT DOES THE FUTURE HOLD FOR THE KENYAN MORTGAGE MARKET?

If someone posed the question 6 months ago, everything looked like Kenya was the best place in the world to invest in the real estate sector… the Central Bank of Kenya had opened up the mortgage market to the entire banking sector allowing all the...

» Consider using a Mortgage Broker?

Consider using a Mortgage Broker?What the experts sayTRUE, many people use brokers for convenience. They'll do the legwork for you and often it costs you nothing extra because they're happy to do it for the fee they'll get from the mortgage lender.

FacebookTwitterLinkedin

Did you know

Rents now rising at ten times the rate of last two years

  • House prices remained resilient, despite the high mortgage rates, with asking prices up 1.3 per cent on previous quarter
  • Closing prices across all houses rose by 0.5 per cent
  • The strongest house price gains came from stand alone houses, where asking prices rose by a significant 2.9 per cent, reversing the price falls of last year
  • Town houses continued to track upwards steadily on asking prices, up 1.1 per cent on March prices, and 6.8 per cent on a year earlier
  • Asking rents are now climbing rapidly, at ten times the rate during 2010 and 2011
  • Asking rents across all properties were almost flat from September 2009 to September 2011, rising just 1.5 per cent over the two years
  • In the nine months since September last year, asking rents across all properties have risen by 7.9 per cent, with 6.6 percent of that increase in the first half of 2012
  • The rental rises have been sharpest for apartments, up 10.33 per cent in the nine months since September last year

Index Highlights:

THE HASS COMPOSITE SALES INDEX YEAR TO Q2
THE HASS COMPOSITE LETTINGS INDEX YEAR TO Q2

HassConsult today announces the results for the second quarter 2012 of its house price and rentals indices, revealing ongoing hikes in rentals against a backdrop of stable house prices. The rise in asking rentals is now running at 10 times the rate during 2010 and 2011, when rents were close to static. From September 2009 to September 2011, the asking prices for rents rose by just 1.5 per cent in total.

However, rising property costs, inflation and - seemingly instrumentally - interest rates, have led to a sharp take-off in rents, now sustained for three successive quarters. Since the end of September last year asking rents across all property types have risen by 7.9 per cent, with 6.6 per cent of that increase falling in the first half of 2012. The sharpest rises are happening in apartment rents, which have risen 10.33 per cent since the climb in rents began at the end of September last year, and 8.1 per cent since the beginning of 2012.

“This surge in rental prices comes as landlords cover higher finance and other costs, and at a time when there is an increased volume of people seeking the same pool of rental properties, as potential homeowners hold off from purchasing,” said Ms Farhana Hassanali-Hashmani, Property Development Manager at HassConsult.

“It is a rise that starkly brings home the immediate impact on all Kenyans of the bottleneck caused in building and buying by pushing finance out of reach for many developers and mortgaged homeowners,” she said. Against this backdrop, Hass welcomed wholeheartedly the first move by the CBK to bring down interest rates, with the cut in the base rate last week from 18 per cent to 16.5 per cent. “The prevailing monetary policy has represented a 'closedown' for home developers in a country where we are severely short of good homes,” said Ms Hassanali-Hashmani.

However, following the decision to cut the frequency of meetings for the Monetary Policy Committee that sets interest rates, to once every two months, HassConsult urged the committee to work as rapidly as possible to bring interest rates down to a more normal and viable level by global standards.
“The hope of attracting foreign funds through top-end rates cannot be ignored, but the impact on ordinary Kenyans of hobbling the real estate industry and creating new rent surges must be considered too in the CBK's efforts to maintain exchange rates at their current levels.”

Also reporting on house prices, HassConsult revealed ongoing stability and even some small gains, with overall closure prices across all types of property rising by 0.5 per cent in the last three months, while asking prices rose by 1.3 per cent. Within this overall figure came some first signs of substantial price growth in standalone houses, where asking prices have risen by 2.7 per cent in the 12 weeks since the end of March, reversing earlier price falls.

Town houses also continued to record gains in asking prices, by another 1.1 per cent in the last three months, to make for an annual increase of 6.8 per cent – the strongest in any segment in the last year. “With interest rates now down and expected to fall further, and much building shelved, we now forecast greater trends towards house price growth, which are likely to set in for some time before we see any relief in the current rate of rent rises,” said Ms Hassanali-Hashmani.

For more information contact:
Farhana Hassanali-Hashmani
HassConsult
020 4446914/0722 204 765/0733629 786


SNAP SHOTS:

  • The Hass Composite sales Index is representative of all property for sale in Kenya
  • Property values have increased by 3.14 times since 2000
  • The index shows a property price rise of 1.3% in the last quarter and a 0.9% rise in the last year.

SNAP SHOTS:

  • The annual average is representative of the average price of all properties offered for sale in Kenya.
  • The average value for a property has gone from 7.1 million in December 2000 to 22.5 million in June 2012.
  • The average value for a 4-6 bedroom property is currently 31.4 million.
  • The average value for a 1-3 bedroom property is currently 11.1 million.

 

SNAP SHOTS:

  • The Mix by Year is a measure of the percentage that each type of property represents in the market.
  • In 2001, apartments took up 23.5% of the market, Town Houses took up 24.5% of the market and Stand alone houses took up 52% of the market.
  • In 2012 however, apartments took up 43.6% of the market, Town Houses took up 26.9% of the market and Stand alone houses took up 29.5% of the market

SNAP SHOTS:

  • Stand Alone houses include houses, bungalows, cottages and villas either on their own plot or in a gated community.
  • Property values for stand alone houses have increased by 3.7 times since 2001, a 2.7% rise in the last quarter and a 1.9 rise in the last year.
  • The average price for a stand alone house is currently 32.6 million up from 8.8 million in December 2000

SNAP SHOTS:

  • Town houses include townhouses and maisonettes that are semi-detached or terraced.
  • Property values for town houses have increased by 2.9 times since 2001, a 1.1% rise in the last quarter and a 6.8% rise in the
    last year.
  • The average price for a town house is currently 19.1 million up from 6.5 million in December 2000.

SNAP SHOTS:

  • Apartments include apartments, duplexes and triplexes.
  • Property values for apartments have increased by 2.2 times since 2001, a 0.5% rise in the last quarter and a 3.0% rise in the
    last year.
  • The average price for an apartment is currently 11.7 million up from 5.2 million in December 2000.Apartments include apartments, duplexes and triplexes.

SNAP SHOTS:

  • The Hass Composite Letting Index is representative of all property for rental in Kenya
  • Rents have increased by 2.6 times since 2001
  • The index shows rents have risen by 2.2% in the last quarter but have risen by 7.7% in the last year

SNAP SHOTS:

  • The annual average is representative of the average rent of all properties offered to let in Kenya.
  • The average rental for a property has gone from Kshs. 38,516 in December 2000 to Kshs. 102,044 in June 2012.
  • The average rent for a 4-6 bedroom property is currently Kshs. 148,998
    The average rent for a 1-3 bedroom property is currently Kshs. 60,122

SNAP SHOTS:

  • The Mix by Year is a measure of the percentage that each type of property represents in the market.
  • In 2001, apartments took up 45.3% of the market, Town Houses took up 20.5% of the market and Stand alone houses took up 34.1% of the market.
  • In 2012 however, apartments took up 56.3% of the market, Town Houses took up 19.6% of the market and Stand alone houses took up 24.1% of the market

SNAP SHOTS:

  • Stand Alone houses include houses, bungalows, cottages and villas either on their own plot or in a gated community.
  • Rental values for stand alone houses have increased by 2.7 times since 2001, a 2.3% rise in the last quarter and a 8.3% rise in the last year. The average rental for a stand alone house is currently Kshs. 156,396 up from Kshs. 56,959 in December 2000.

SNAP SHOTS:

  • Town houses include townhouses and maisonettes that are semi-detached or terraced.
  • Rental values for town houses have increased by 2.3 times since 2001, a 2.9% rise in the last quarter and a 4.1% rise in the last year. The average rental for a town house is currently Kshs. 99,288 up from Kshs. 42,688 in December 2000.

SNAP SHOTS:

  • Apartments include apartments, duplexes and triplexes.
  • Rental values for apartments have increased by 2.8 times since 2001, 2.4% rise in the last quarter and an 11.7% rise in the last year. The average rent for an apartment is currently Kshs. 64,295 up from Kshs. 21,638 in December 2000.
Talk to us

First time buyers promise

  • Learn about mortgages
  • Guide you through the process
  • Help you on get on the property ladder

Speak to our friendly experts
Call +254 729 933955
Click tmcafrica.com