INVESTIGATION INTO THE CHALLENGES FACING REAL ESTATE DEVELOPMENT IN KENYA (A CASE STUDY OF KENOL TOWN, MURANG’A COUNTY)

ABSTRACT
Real estate plays a key role in the social and economic development of a country. Real estate
development is defined as the improvement of raw land through the development process in
which physical ingredients such as land and buildings are effectively combined with finances
and marketing resources in order to create an environment in which people live, work and
plan (Peca, 2009).A real estate developer carries out improvements either by starting from the
ground or by renovating an existing property. The researcher was inspired by the need for
housing in Kenya which surpasses the supply and hence the need to address the current
challenges in real estate development to improve the situation.The Kenya vision 2030
estimates that 200,000 house units are required yet only 35,000 are produced annually.
The objectives of this study were to document the nature of real estate development in Kenol
town, to explore the challenges facing real estate development and how they affect real estate
developers, to make recommendations and additional measures that will mitigate these
challenges. The study sampled an identified population to represent the targeted population of
the town. These were the real estate developers and investors, Makuyu town council officials,
Maragua town council officials and the Murang’a South District Physical Planner.
Questionnaires and interviews guide were used as the main data collection tools.
Questionnaires were administered to real estate developers and investors while the scheduled
interview were directed to Makuyu and Maragua town council officials. The data collected
was analysed using descriptive statistics.
The study established that lack of capital; high interest rates, poor planning and poor
infrastructure were the key challenges facing the real estate development in Kenol town. The
study concluded that lack of capital has a negative effect on real estate developments in
Kenol town accepting the hypothesis of the study.