Photo Credits: Tatu City
Mortgage financing has been one of the most sought-after services offered by various financial institutions and some pure mortgage financing firms. However, banks are the major players in the provision of mortgage loans to home buyers and developers.
In the recent past, new areas have risen to become prime residential and commercial centers. Among these hotspots of growth is Special Economic Zone, Tatu City.
Tatu City is a 5,000-acre, mixed-use development with homes, schools, offices, a shopping district, medical clinics, nature areas, a sport & entertainment complex, and a manufacturing area for more than 150,000 residents and tens of thousands of daily visitors. Schools and businesses are already open at Tatu City, and a range of houses are under construction to suit all incomes.
Tatu City’s Special Economic Zone status provides;
- Reduced corporate taxes
- Customs and excise duty exemptions
- VAT benefits
- Profit and capital repatriation at reduced rates
- Enhanced intellectual property rights, among others.
In the recent development, ABSA Bank Kenya has sought to make mortgage financing for home buyers and developers accessible at the best rates in the market. The two entities entered a partnership that will see home buyers and developers get benefits such as construction loans, equity releases (which is a means of retaining use of a house or other object which has capital value, while also obtaining a lump sum or a steady stream of income, using the value of the house)
The idea is that the mortgage provider must be repaid at a later stage, usually when the homeowner dies. Other benefits that will accompany the partnership include access to Lariba mortgages, insurance products such as mortgage protection, fire insurance covers for the applicants, and retrenchment covers which pays the applicants a certain amount of money for up to a certain period such as 1 year in case of loss of employment.
Besides, the partnership will see normal mortgage applicants receive financing of up to 80% while construction mortgages will receive up 100% financing, applicants will also enjoy the benefit of no early repayment charges. The partnership will indeed be one of its kind in the mortgage market that seeks to make Tatu City even a more attractive hub for both commercial and residential purposes. “We understand just how difficult it is for many people to own a home, despite this being a dream for most Kenyans,” Head of Mortgage Absa Mr. George Laboso reckoned.
His sentiments were backed by those of Head of Residential Sales Tatu City Madam Beatrice Njeri who said the aim of the partnership was mainly to make homeownership possible to all income earners in such a prime area. Tatu City’s potential is on the watch, and Absa is indeed facilitating the realization of a complete special Economic City.
Felix O. Mbaka
Head of Finance & Economics Sub-sector
Get real time update about this post categories directly on your device, subscribe now.