National Bank of Kenya (NBK) and Costa Homes yesterday launched an off-plan housing development account where buyers’ funds will be held until delivery of their completed units.
NBK managing director Paul Russo said the savings plan seeks to eradicate instances where developers use pre-sale funds for development of housing units with some failing to deliver the units as agreed.
“We are giving assurances to Kenyans and even our diaspora community that you can buy houses off-plan with your monies securely held until the developer delivers your housing unit,” he said.
“Fraudulent developers have given the sector a bad name. We are a member of KCB Group and that gives us good understanding of the mortgages sector.”
Mr Russo said the product is aimed at restoring confidence among house buyers where some developers have failed to fulfil their promises leading to loss of funds.
He added that off-plan customers will qualify for mortgages, enabling them to move into the housing units faster.
“Once you occupy a house that belongs to you means it will be much easier to service the mortgage using money previously spent on paying rent,” said Mr Russo.
Financial services firm Octagon Africa chief executive Fred Waswa said its 90,000 clients will be their first customers on select projects being undertaken by Costa Homes across Kenya.
“Saving about Sh50,000 a month guarantees you a Sh4 million home in six years and with house prices starting at Sh1.8 million for a one-bedroom house, Sh2.8 million for a two-bedroom house, one can plan to own a home by starting to save for buying a home off-plan,” he said.