The prices for houses are set to rise in the coming weeks after the cost of basic construction materials such as cement and steel shot up.
The rise in the cost of steel has been caused by the ongoing war between Russia and Ukraine as the two countries are the major exporters of steel and iron sheets.
According to the 2020 United Nations Comtrade data, Kenya imported iron sheets and steel worth Ksh17.9 billion from Russia and Ukraine in 2020. Russia was the biggest exporter taking up Ksh13.4 billion.
The invasion of Ukraine started on February 20 and the war caused the rise in commodities due to a decline in the production of some of the raw materials.
The war has already seen some of the basic commodities such as bread rise given the shortage in wheat.
According to the Business Daily, the price of a tonne of steel has gone up by over Ksh15,255 due to the global shortage that is being experienced.
Though the rise in the cost has not been determined, real estate developers state that the rise in construction prices will also have to be effected when house prices are being determined.
Steel bars are important in construction, especially in the building of storey buildings which has been adopted by many real estate developers.
Additionally, the cost of cement has already gone up. In a statement by Bamburi Cement on March 9, it was revealed that the prices of cement would increase from 2 percent to 10 percent.
The increase in the cost of cement was blamed on the lack of raw materials
"The cost on input raw materials continues to increase disproportionately compares to what Bamburi Cement can absorb and therefore we have to pass on part of the cost to the market but rest assured we are taking all possible measures to mitigate these adverse effects," read part of the statement.
The giant manufacturer, further stated, "These price changes are effective March 10 and the effects of our plants in Nairobi, Mombasa, Limuru, and Sagana depots."
