A steady improvement in credit to the building and construction sector contributed to a growth of cement manufacturing sub-sector in the third quarter of last year, according to the latest Kenya Bankers Association-Housing Price Index data.
- •As of the third quarter 2023, cement production recorded a quarter-on- quarter growth of 7.24 percent to 2,541,763 metric tons (MT) from 2,370,246 MT in Second quarter 2023.
- •Consumption of cement also grew, but at a lesser growth rate of 7.24 percent to 2,430,488 MT in the third quarter of 2023.
- •The increase in consumption was anchored on steady improvement in credit to building and construction and real estate sectors.
“Credit growth in the building and construction sector saw a moderate increase, reaching 13.04 percent in December 2023, up from 2.74 percent in October 2023. Conversely, lending to the real estate sector experienced a relatively lower growth, though rising to 6.46 percent in December 2023 from 3.74 percent in October 2023.”
The KBA Index, which tracks housing price movements from the last quarter of the year 2021, shows a persistent and uneven negative-territory home prices growth trajectory, in a trend that the KBA-HPI associates with corresponding fluctuating activity in the construction sector.
Most home buyers sought lower-segment houses in the year 2023 even as real estate developers grappled with a sustained overall wobbly decline in housing units’ prices for most part of the year.
According to the data, there was a marked demand uptick within the low-market segment in the last quarter of the year 2023, accounting for 62.3 percent compared to 48 percent recorded in the previous quarter.
The trend followed an overall sustained negative pace of house prices growth in the first three quarters of the year despite recording a modest 1.53 percent decline in the last quarter, driven by a slight strengthening of demand towards the end of the year.
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