More Kenyans buying properties in the UK
30 May 2022
Good morning,
How much time do you spend in traffic daily? a 2017 report by Numbeo ranked Nairobi as having the second worst gridlocks globally, with commuters spending 55.8 minutes in traffic.
This lead to an estimated loss of Ksh 58 million dailyMore Kenyans are buying houses in the UK for renting
According to Britain-based property investment dealer, Mark Pearson, Kenyan buyers are spending an average of 210,000 pounds (Ksh30.7 million) on a house in Birmingham, Manchester, London, Liverpool, and Leeds in the UK as a way to diversify their investments.
“We are getting a lot of interest from East Africa and predominantly through Kenya. Our average purchase from a Kenyan client is 210,000 pounds. Buyers are allowed to invest 25% of the amount with a mortgage company or bank paying the rest” - Mr Pearson.
According to data from Mr Pearson, these apartments are located in major cities in the UK where the owners rent them out to locals or foreign Kenyan students studying in the UK.
Why are more kenyans investing in the UK?
The pricing of property in Nairobi is misaligned to the average salaries of buyers and tenants. This has translated into low occupancy rates and less returns on investments made by property owners.
Investors in the UK get a tax relief of up to 12,500 pounds (Ksh1.83 million) on the first investment.
In the UK, a return on investment in property ranges from 12% - 16% per year.
CAPITAL MARKETS
The Central Bank of Kenya (CBK) floated an 18-year Infrastructure bond
The Central Bank of Kenya floated an 18-year Infrastructure bond worth Ksh 75 billion. The Government intends to use proceeds from this auction to fund infrastructure projects in the 2021/22 budget estimates.
According to the CBK prospectus, the coupon rate for this bond will be market-determined with the period of sale starting as from 23rd May 2022 to 7th June 2022.
The value and payment date is 13th June 2022, and investors are required to place bids at a minimum of KSh 100,000.00.
This bond will be fully redeemed on 21st May 2040.
The first interest payment is scheduled for 12th December 2023.
CBK requires bidders to submit their bids by 2.00 p.m. on Tuesday, 7th June 2022, while the Auction Date is Wednesday, 8th June 2022
THE FINANCE BILL 2022
Highlights from the recommendations of the National Assembly Finance Committee on the Finance Bill
The National Assembly Finance committee gave the following recommendations on the Finance Bill 2022
On Capital Gains Tax:
The committee recommended that the rate be revised to 10% rather than 15%.
2. On Excise Duty
The Commitee proposed;
An Increase of Excise Duty on cigarettes. The Committee held that cigarette smoking has adverse health implications, as such, it should be discouraged hence the increase in excise duty was upheld.
Excise rate on Fruit Juices be reduced to Ksh13.00 per litre from the initial proposal of Ksh 13.30 per litre. The old excise rate was Ksh 12.17 per litre.
The Committee adopted the proposal in the bill that excise duty of Cosmetic products be set at 15% to discourage fake and counterfeit beauty products.
The Committee recommended the deletion of excise duty on bottled water as it would increase the price of the commodity.
The Committee recommended the deletion of the proposed increase of excise duty on imported motorcycles. This is because an increase in the cost of motorcycles would make them unaffordable to Kenyans.
EXPENDITURE
The state spent Ksh 260 million on Former President Mwai Kibaki's funeral.
Mr Kibaki died on April 22 at the age of 90 and was buried on April 30 in Othaya, where he was accorded a state burial.
To cater for the burial expenses, Treasury invoked Article 223 of the Constitution that allows the State to spend money not approved by Parliament and later seek approval of lawmakers within two months of the expenditure.
A breakdown of the expenditure was not provided.
The funeral expenses of President Daniel arap Moi who died on February 4, 2020, were also not revealed.
The funds were released through the State Department for Interior and Citizen Services.
MEDICINE
Kenya plans to roll out a grant telemedicine program countrywide
The government, through the Communication Authority, has set aside Ksh 600 million to fund the laying out of the foundation for telemedicine in 20 health facilities.
The program is expected to improve access to healthcare, particularly in remote and marginalized regions.
Piloting of the program was conducted at the Kenyatta National and Isiolo Hospitals.
The Ministry of Health has developed a Digital Health Platform that will enable real-time collection of patient data and provide platforms for integration with other critical databases - Dr Joseph Sitienei, head of the Health Service Management department, Ministry of Health
TOURISM
Kenya plans to regulate the number of daily visitors allowed in national parks
The Ministry of Tourism and Wildlife plans to regulate the daily number of visitors allowed in some national parks and game reserves to reduce high season overcrowding.
This means that the high-volume parks and reserves, Masai Mara, Amboseli and Nairobi National Park, will not allow visitors above their capacity of 32,000, 13,0000 and 10,000 visitors per month respectively.
The number of visitors, both local and non-resident, will be limited to using an online ticketing and digital payment system that the Kenya Wildlife Service (KWS) plans to roll out across all national parks and reserves.
The effect of this?
There will be an increase in entry rates during the high season due to increased demand. Visitors will also be obliged to book park entry tickets in advance to manage influx and prevent fraud at the gate.
Tickets will be non-transferable and will be tagged against personal ID or passport number to prevent reselling by large tour operators.
WHAT YOU MUST HAVE MISSED
Start of a Diplomatic row between DR Congo and Rwanda
DR Congo summoned Rwanda's ambassador and suspended RwandAir flights to Congo in response to what the country says is Rwanda’s support for M23 rebels that have been fighting the Congo government.
Congo's government spokesman, Patrick Muyaya, announced the suspension and the summoning of the ambassador.
Kenya Bankers Association (KBA) urged the Central Bank of Kenya(CBK) to raise the policy rate
KBA urged the Central Bank of Kenya(CBK) to raise the policy rate when its Monetary Policy Committee(MPC) meets today. In a research note, KBA said the MPC should tighten monetary policy stance so as to rein in rising inflationary expectations and support market and macroeconomic stability.
Kenya to explore the Malaysian market for export of avocado
Kenya is targeting the Malaysian market for the export of avocado as it seeks to expand its reach. The plant regulator, Kenya Plant Health Inspectorate Service (Kephis), stated that it had received inquiries from Malaysia, whose officials want to visit the country to assess if Kenya can export avocados to the Asian nation.
Geothermal Development Company (GDC) plans to add 49 megawatts of geothermal power to the national grid
in February 2011 the company began drilling the first well on the floor of Menengai crater to tap geothermal energy. However nothing has been produced from the wells even though it has the potential of generating 1,600 Mega Watts of clean energy.
Who has the mandate to prosecute cases in court?
The High Court quashed Ksh17 billion tax evasion charges against businessman Humphrey Kariuki on grounds that the police should not have drafted the charge sheet.
Justice Anthony Mrima stated that although the police, the Ethics and Anti-Corruption Commission (EACC), and Kenya Revenue Authority have the mandate to investigate crimes, the agencies cannot draft, sign or present any charge sheets in any criminal prosecution.
The judge also quashed a gazette notice by the Director of Public Prosecutions, Noordin Haji which appointed prosecutors from the KRA to handle the case.