Like the previous two portals we've spoken to in our Africa series, BuyRentKenya has been in the business for 10 years.
The leading real estate marketplace in Kenya was part of the One Africa Media Group of online classifieds titles before the merger with Swiss-headquartered marketplace operator Ringier in 2017.
Since then the portal has been part of a group which includes leading Senegalese property vertical MaMaison, the generalist platforms Pigiame (Kenya), Expat Dakar (Senegal) and Qefira (Ethiopia) as well as several leading employment portals across the continent.
Lizzie Costabir has been working for BuyRentKenya for nearly nine years having been promoted to CEO from the marketing department in 2017. Who better to tell us about the challenges and opportunities associated with the business of running a real estate vertical in Kenya..?
Like most players in Africa, BuyRentKenya operates a pay-to-list model for estate agents, developers and private individuals. The company also sees a lot of value in adjacent revenue streams and, like most leading portals around the world, is engaged in generating mortgage leads for third-party financial institutions.
BuyRentKenya clearly wants to do more than generate leads though. Costabir says that since Ringier took came in, there has been an emphasis on business intelligence and the portal has doubled down on technology including a back end for agents that helps them manage their properties and listings.
Kenya is an attractive market with Property Centre, PropertyPro and Property24 as well as horizontals like Jiji all present but Lizzie is proud that her team is the only one of the vertical players whose team is locally based in Kenya and the only one with dedicated account management services.
"We're quite proud when it comes to thought leadership and stakeholder partnerships in the market in the industry."
Ringier obviously sees the value in continuing to invest in the Kenyan online classifieds market and recently bought out co-shareholder SEEK Ltd from ROAM. The attraction to her home market for any overseas-based investor is clear for Costabir.
"Kenya is one of the more stable economies in the region. Its currency has only devalued by around 20% over the covid period which is much better than most of the big African economies. So it's really seen as one of the best opportunities for success in the region."
Along with a mature banking sector, hospitality plays a big part in keeping the economy flowing and tourists are starting to come back to Kenya after the worst of the pandemic which Costabir says is having a positive trickle-down effect on the housing market with the sense of opportunity palpable.
"The ceiling for innovation is just infinite at this point."
However, unlike in Nigeria, where PropertyPro CEO, Fikayo Ogundipe told us that there are companies exploring the idea, Kenya is not ready for tricky models and ideas like iBuying according to Costabir:
"There is the rise of FinTech. There is the rise of e-commerce. But we're not there yet."
In terms of the challenges of operating a real estate vertical business in Kenya, Costabir says that they are the same as her counterparts in other developing markets: a lack of trust and transparency as well as fraud and cons on social media channels which are still all too common.
There is also the issue of user sophistication and confusion about the role of a real estate marketplace:
"There's also limited understanding when it comes to an online property marketplace. There's confusion between a marketplace and a real estate agent. You'll get people ringing you up and thinking you are an agent."
The issue of educating users and customers alike to the benefit of online real estate is improving though. Like in Nigeria and Ghana, Costabir says that the pandemic was a catalyst to raising the level of digitization for real estate brokers and that this trend is expected to fuel the growth of the core listings business over the next few years as more are persuaded to do business online.
It was also a catalyst for BuyRentKenya to start offering more solutions such as virtual tours and market intelligence and price estimation. Costabir says that business intelligence and consumer education are key for anyone running a marketplace business in the market as well as educating the market, something the portals are increasingly doing...
"...by filling gaps of information and providing accurate and up-to-date transparency when it comes to property information. That's what BuyRentKenya's trying to do, democratize these structures."