The rising cost of construction materials will push up housing prices in the coming months, according to players in the real-estate sector.
Experts in the sector are warning that the housing unit costs could double in the coming year unless the government addresses the rising prices of steel, cement, fuel and paint among others.
This comes at a time it when some clients and contractors have suspended their projects after over-running their budgets due to the soaring prices.
Home Real-Estate managing director, James Waiganjo said that the rising cost of construction materials would have negatively impact on the construction industry.
The industry is just recovering from the impact of the Covid-19 pandemic.
He said some of their clients had canceled or suspended their contracts in various parts of the country due to budget constraints.
“We are projecting that by the end of the year the cost of houses will double due to the rise in nearly all materials used in construction,” he said.
Waiganjo said that this spelt doom for hundreds of families keen on home ownership and for hundreds of workers who earn their daily bread through the sector.
Acccording to the Association of Construction Managers of Kenya (ACMK), the price of steel is currently at its highest ever in the construction sector's history.
The association's chairman Nashon Okowa said that the rise in the cost of construction materials was worrying with cement and steel companies moving in to increase the prices.
“We urge the government to move quickly and address these prices as they will end up crippling the construction industry this year,” he said.
Okowa said some of the prices as unjustifiable noting that the situation has been worsened by the ban on scrap metals.
“We are witnessing an unprecedented rise in the price of steel with no reprieve in sigh, while cement and paint companies have issued notices to also increase their prices,” he said.
Earlier this year, the PS for Housing Charles Hinga said that the cost of construction in the country had dropped by over 300 percent in the last four years.
Speaking at a conference for stakeholders in the mortgage sector in Naivasha, Hinga said the cost of constructing one meter square currently stood at Sh25,000 down from Sh88,000 in 2017.
“The cost of construction has dropped by over 300 percent while the cost of houses has dropped from Sh11m to around Sh5m per unit,” he said during the conference.
