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The Mortgage Company - Any Info on Them?
tonicasert
#21 Posted : Friday, August 02, 2013 1:14:14 PM
Rank: Member

Joined: 3/10/2008
Posts: 301
Location: Abu Dhabi
Has any wazuan constructed using TMC's services?
a4architect.com
#22 Posted : Friday, August 02, 2013 2:34:52 PM
Rank: Veteran

Joined: 1/4/2010
Posts: 1,668
Location: nairobi
stocksmaster wrote:
Olu wrote:
Elder wrote:
Came across this company during the just ended Expo. Their website doesn't offer much, no history of their projects that I can find and their office numbers are cell phones. Anybody dealt with them or know more about them?



Their Makazi mema product is really good. Call one of their representatives and they can take you to one of their show houses. I think they have a tour bus scheduled for this Saturday unless am mistaken.


The Morgage Company stand at the just ended Housing Expo was my best moment.
Its Makazi Mema product if well marketed may prove to be a game changer in the morgage industry in Kenya. That lady must be a genious!!

This is how the Makazi Mema product rolls out:
The Morgage company has brought together 2 other partners:
1. Rafiki Deposit Taking Microfinance
2. Oaks Construction Company

Step 1. The Morgage Company first conducts a due deligence to ascertain ability to pay morgage.
Step 2. An individual needs at least an eigth of an acre (50 by 100 plot)- The Rafiki Microfinance will finance upto 70% of the purchase price of the plot.
Step 3. With a title deed in hand, you are given about 6 designs to choose from ranging from 2 bedroom house of 50sqm to a 4 bedroom of 150 sqm.
Step 4. The Oaks Costruction company is given the funds to construct the hse and within 4-6 months, the house is ready for occupation.

What makes the product great?
1. The house is delivered at cost ie the smallest house of 50sqm is projected to cost Ksh 1M; the largest house of 150sqm is projected to cost Ksh 3.5M. (This means the construction costs are within a range of Ksh 20,000 - 23,500 per sqm).
2. Since the houses are delivered at cost, the morgage repayment amount is approximately half the amount a similar buyer of a house will pay if the house is bought from a housing developer. ie The 4 bedroom house of 150sqm which is delivered at a cost of Ksh 3.5M would be priced at about Ksh 6-7M if bought from a housing development company.
Repayment amounts over a 10 year period therefore range from Ksh 18,019 (for the 50sqm house) to Ksh 63,056 (for the 150sqm 4 bedroom house). The key to this reduced morgage repayment figures is based on getting the house at actual cost hence eliminating the mark-up imposed by developers.
3. Repayment starts after occupation.....means it can be a seamless transfer from rent payment to morgage payment.
4. Ready designs available for clients to choose from.

The product targets the middle class. I only wish they can upgrade the ceiling to houses whose construction costs are about Ksh 5-6M (about 220 -260sqm) with a repayment of about Ksh 90,000 - 108,000 p.m.

They also need to up their marketting of this great product......i was informed that more than 500 people registered for the product during the Expo!

Happy Hunting and Kudos to Carol Kariuki.


If actual construction is delivered at cost, how does the contractor make his money?
Who pays for construction project management?
Any one here who can share with us the final house pictures?
As Iron Sharpens Iron, So one Man Sharpens Another.
stocksmaster
#23 Posted : Friday, August 02, 2013 2:51:44 PM
Rank: Member

Joined: 9/26/2006
Posts: 463
Location: CENTRAL PROVINCE
a4architect.com wrote:
stocksmaster wrote:
Olu wrote:
Elder wrote:
Came across this company during the just ended Expo. Their website doesn't offer much, no history of their projects that I can find and their office numbers are cell phones. Anybody dealt with them or know more about them?



Their Makazi mema product is really good. Call one of their representatives and they can take you to one of their show houses. I think they have a tour bus scheduled for this Saturday unless am mistaken.


The Morgage Company stand at the just ended Housing Expo was my best moment.
Its Makazi Mema product if well marketed may prove to be a game changer in the morgage industry in Kenya. That lady must be a genious!!

This is how the Makazi Mema product rolls out:
The Morgage company has brought together 2 other partners:
1. Rafiki Deposit Taking Microfinance
2. Oaks Construction Company

Step 1. The Morgage Company first conducts a due deligence to ascertain ability to pay morgage.
Step 2. An individual needs at least an eigth of an acre (50 by 100 plot)- The Rafiki Microfinance will finance upto 70% of the purchase price of the plot.
Step 3. With a title deed in hand, you are given about 6 designs to choose from ranging from 2 bedroom house of 50sqm to a 4 bedroom of 150 sqm.
Step 4. The Oaks Costruction company is given the funds to construct the hse and within 4-6 months, the house is ready for occupation.

What makes the product great?
1. The house is delivered at cost ie the smallest house of 50sqm is projected to cost Ksh 1M; the largest house of 150sqm is projected to cost Ksh 3.5M. (This means the construction costs are within a range of Ksh 20,000 - 23,500 per sqm).
2. Since the houses are delivered at cost, the morgage repayment amount is approximately half the amount a similar buyer of a house will pay if the house is bought from a housing developer. ie The 4 bedroom house of 150sqm which is delivered at a cost of Ksh 3.5M would be priced at about Ksh 6-7M if bought from a housing development company.
Repayment amounts over a 10 year period therefore range from Ksh 18,019 (for the 50sqm house) to Ksh 63,056 (for the 150sqm 4 bedroom house). The key to this reduced morgage repayment figures is based on getting the house at actual cost hence eliminating the mark-up imposed by developers.
3. Repayment starts after occupation.....means it can be a seamless transfer from rent payment to morgage payment.
4. Ready designs available for clients to choose from.

The product targets the middle class. I only wish they can upgrade the ceiling to houses whose construction costs are about Ksh 5-6M (about 220 -260sqm) with a repayment of about Ksh 90,000 - 108,000 p.m.

They also need to up their marketting of this great product......i was informed that more than 500 people registered for the product during the Expo!

Happy Hunting and Kudos to Carol Kariuki.


If actual construction is delivered at cost, how does the contractor make his money?
Who pays for construction project management?
Any one here who can share with us the final house pictures?


A friend is currently constructing his 200sqm mansion at a cost of about Ksh 5M (Ksh 25,000 per sqm) through this Makazi Mema Product.

Management fees is paid by the client of about Ksh 50,000.

The design was his and only a few modifications were done by the Morgage Company.

Will try and send pictures once i visit the site.

As to how the construction company makes its money, the Ksh 25,000 per sqm must have factored in a modest margin based on expectations of high volumes.

Happy Hunting.
x handle: @stocksmaster79
a4architect.com
#24 Posted : Friday, August 02, 2013 3:35:54 PM
Rank: Veteran

Joined: 1/4/2010
Posts: 1,668
Location: nairobi
from past experience i can foresee how this model will go . I have never seen successful construction projects implemented without the consulting management part.
How can 50k be enough to cater for architect/qs/engineer services?
How do they resolve issues without the consulting arm of arch/qs/engineer? How do they ensure structural integrity without consultants?
How do they ensure customers who would like higher quality constructions get their worth?
Generally, people who afford to construct houses over 150m2 also tend to choose high end finishes, with costings of over 30k per m2.
With a budget of 50k, is there advisory from architect/qs to customers so as not to have a Kayole like building in Runda mismatch?

Kenyans need to learn from more developed economies eg South Africa. No need for a mortgage company to offer services suposed to be offered by other professionals. TMC needs to partner with consultancy firms for it to survive. I can foresee legal suits due to poorly constructed buildings, budget overruns etc.
As Iron Sharpens Iron, So one Man Sharpens Another.
Gathige
#25 Posted : Friday, August 02, 2013 4:23:01 PM
Rank: Elder

Joined: 3/29/2011
Posts: 2,242
a4architect.com wrote:
from past experience i can foresee how this model will go . I have never seen successful construction projects implemented without the consulting management part.
How can 50k be enough to cater for architect/qs/engineer services?
How do they resolve issues without the consulting arm of arch/qs/engineer? How do they ensure structural integrity without consultants?
How do they ensure customers who would like higher quality constructions get their worth?
Generally, people who afford to construct houses over 150m2 also tend to choose high end finishes, with costings of over 30k per m2.
With a budget of 50k, is there advisory from architect/qs to customers so as not to have a Kayole like building in Runda mismatch?

Kenyans need to learn from more developed economies eg South Africa. No need for a mortgage company to offer services suposed to be offered by other professionals. TMC needs to partner with consultancy firms for it to survive. I can foresee legal suits due to poorly constructed buildings, budget overruns etc.



@a4a, TMC has identified a gap in the market which they are addressing. Majority of Kenyans are looking for affordable housing and the TMC seems to be helping. As raised above, it seems their target is the middle market who have a shoe-string budget. For the higher end of the market who can afford all the professionals i am sure they will not go the TMC way.

I have had several drawings that needed approvals and my draftsman has facilitated the architects and QS "stamps" at a small fee. I understand the risk for small projects but the day i "vuka border" i will get the right professional as i will have the capacity to pay.
"Things that matter most must never be at the mercy of things that matter least." Goethe
a4architect.com
#26 Posted : Friday, August 02, 2013 4:59:02 PM
Rank: Veteran

Joined: 1/4/2010
Posts: 1,668
Location: nairobi
@gathige. Even for the lowest end market,there is need for companies to give full discolsure to their customers.
As the country moves forward, i would love to see very cheap but organised buildings like in South Africa. There are various ways to pool professional fees together. TMC should work with any architect who can then give subsidised services as opposed to letting Kenyans risk their millions .
After several lawsuits from disatisfied cutomers is when they will realise the damage they are giving . To me this is falls in the borderline of mis asadvicing clients. There is no way Kenya can move forward if companies are let to mis advice consumers. Use of the right personnel for the right job ensures savings/production to the end user.

In your case with the draftsman, this is ok since you willingly decide to follow this route hence shoulder any losses.
For a company to mis inform customers, the customers are not given any choice.

All commonsense and logic shows that any person who ulitises services of consultants in their project saves money.
Prove me wrong on this. Even for a slum house, the slum lord who will get the best consultancy will eventually save money.

Any division of labour i.e arch/eng/qs should result in efficiency and productivity.

By taking shortcuts around this is by no means innovative. In the beginning, it will look like a saving but eventually, the loss will befall all as a country.
This is the same logic that all developer whose buildings collapse have. To them, they think they are innovative.
If the whole country does not encourage n support consultancy, who will come up with cost saving research? The foreman, fundi or mtu wa mkono? unfortunately not.
Lets use the right skillset for the right job for a better tomorrow.

This is how consumers are protected from buying poor services in Kenya.

http://www.news24.co.ke/...n-can-be-taken-20130802

Quote:
airobi - Big firms have come underfire from the Anti Counterfeit Agency (ACA) for not being proactive, leading to a rise in counterfeit goods in supermarket shelves.

In a statement to Capital News, ACA Chief Executive Officer Stephen Mallowah said that companies do not report counterfeits infringing on their brands, causing increase in fake goods in the Kenyan market.

Mallowah added that until brand owners formally complain, there is nothing the agency can do, as many fear the bad press their brands will get and opt to remain silent.


Very true. Unless AAK and other bodies that regulate construction in Kenya take over, its not easy for any random person to complain.
As Iron Sharpens Iron, So one Man Sharpens Another.
CLK
#27 Posted : Sunday, August 04, 2013 8:48:06 AM
Rank: Member

Joined: 4/1/2009
Posts: 846
I think what the mortgage company is doing makes a lot of sense, if i were to take a mortgage from a bank on a 6m house say the NSSF flats in Nyayo Embakasi

If say the above house cost say 3m to build, the property owner pegs it at 6m making a profit of 3m
The bank charges interest of 14-17% or more over a period of 15-20yrs doubling/tripling the 6m market rate.

TMC, are cutting the middlemen and the banks besides the cost for building is minus the initial cost of the plot, this justifies how they will make the profits.

I think TMC are finding a better way of investing their money while creating employment and cheaper/affordable housing for Kenyans..
a4architect.com
#28 Posted : Monday, August 05, 2013 1:31:19 PM
Rank: Veteran

Joined: 1/4/2010
Posts: 1,668
Location: nairobi
@clk.
There are ways to reduce construction cost eg using innovative tech eg south african moladi etc etc.
http://www.moladi.net/

http://www.frametech.co.za/

These methods are based on science and usually have consumer protection standards e.g engineering.arch.qs specifications.

TMC method is not showing any new way of reducing construction cost apart from crude shortcuts of undercutting consultants.

@pennystocker here in wazua is achieving much less than TMC with his kes 20k per m2.

http://www.wazua.co.ke/f...px?g=posts&m=415602

80% of Kenyans construct using @pennystockers method and it works.

The TMC method is faulty because it costs slightly more than self build but with risks. In self build, owner decides how to deal with risks eg by reducing them and including consultants .
In TMC method, they dont give the owner an ability to reduce their risk.
They also dont help to add on to knowledge base that can propel Kenya to South African construction innovation level.

With the TMC method at kes 27k per m2, this is too much for the service compared with the facxt that someone can still get the same for kes 20k per m2 and still manage to include consultants to reduce risk.
As Iron Sharpens Iron, So one Man Sharpens Another.
a4architect.com
#29 Posted : Monday, August 05, 2013 2:40:09 PM
Rank: Veteran

Joined: 1/4/2010
Posts: 1,668
Location: nairobi


Here TMC say their cost is kes 20k per m2, nealy same as @pennystockers cost.

http://www.tmcafrica.com/our-services/makazi-mema


Here, they contradict themselves. Only a very Keen customer with ability to calculate cost per m2 can see this.
The cost moves up to kes 27k per m2.

http://www.tmcafrica.com/our-services/makazi-mema

2 BR - 55sqm (Kes 1,500,000)

This works out to 27k per m2.
As Iron Sharpens Iron, So one Man Sharpens Another.
Litro
#30 Posted : Monday, August 05, 2013 2:43:24 PM
Rank: Member

Joined: 7/22/2009
Posts: 120
Location: KENYA
@a4a.. Your main problem with TMC seems to be on whether payment for consultancy fees has been factored in!! Have you checked with them and confirmed that the 50k is not enough given the economies of scale. I also dare say that Architects and Qs's collaborate and inflate building costs so as to get higher fees..
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