Kenya’s property market faces increased challenges related to land fraud, squatter invasions, and disputes that threaten the safety of homeowners and investors.
With land becoming a lucrative asset, cases of fake titles and the selling of one property to multiple people are rampant, thus exposing buyers to great risks.
In a video doing round social media of a group of buyers who bought land with Safaricom investment sacco 11 years ago and due to inaccessibility of the site due to poor road and the area being flood prone on heavy rains, they finally decided to hit the road and try make it to the site by themselves since Safaricom sacco never planned site visit, they however have tittle deeds. It turned out they bought castles built on air.
Check out the video.
The sacco strategy is You buy the plan like off-plan then wait for site visit only to find yourself in no man’s land. Cheap is truly expensive trade affair.
Clients and Kenyans have come out rioting and calling out Safaricom sacco together with other culprits like Classic 105 radio station Maina and Kingangi morning show of promoting these land frauds using their influence. Fans and members bank on their trust and reputation to purchase these off-plan projects only to cry foul later on.
Priceless advice when purchasing land via these saccos or any other institution is first view of the site on a rainy season for you might be purchasing a swamp in this economy.
Struggles In Liquidating In SIC.
Safaricom Investment Cooperative is one hell of a ride in terms of liquidity of shares upon exit from the sacco.
The illiquidity of SIC’s shares has been compounded by the value of the stocks remaining at Sh52.5 each since 2019, a decline from the peak of Sh525 seen in 2017 and 2018.
The fall in the share price is partly due to lower returns in recent years. To leave SIC, a member must offer their shares for sale on a first-in, first-out (FIFO) basis. Alternatively, a member can sell their shares to another existing member, but this is arranged via email. If there are no buyers, the shares can’t be sold, and the member is stuck with them until there is interest from other investors. Consequently, SIC has paid a rebate of less than 10 percent since 2019 when it made zero distributions. Last year, it paid a rebate rate of 5.75 percent amounting to Sh143.8 million, down from seven percent (Sh176.9 million) in 2022. The company recorded a net operating surplus before rebates of Sh203.4 million last year, down from Sh268.1 million in 2022 on the back of reduced revenues in the core real estate business. Sale of land and houses dropped to Sh1.5 billion in the review period from Sh1.8 billion a year earlier, resulting in gross surplus from this business line declining to Sh437.5 million from Sh471 million after netting off cost of acquiring the properties. Due to continued fraud in sales of these lands by Safaricom Sacco, the sacco is going to plunge in crisis and probably on its deathbed. Despite rebranding the name, they cannot do away with fraud cases on land owners. Investors are opting to sale their shares at throw away prices to just exit and invest in better options. RIP SIC.
KenyanHour 