HOUSING COSTS AND FINANCIAL HEALTH OF HOUSING DEVELOPMENT INSTITUTIONS IN NAIROBI METROPOLITAN AREA, KENYA
Abstract
This study examined the effect of housing costs on the financial health of housing development institutions in the Nairobi Metropolitan Area, Kenya. The study was founded on the theories of housing adjustment, urban economics, positive theory of housing, and Marxist theory of housing. The 53 home development organizations in the Nairobi Metropolitan Area that were registered with the Kenya Property Developers Association made up the study's target population. The study purposively selected 16 institutions. The study employed descriptive statistics for data analysis and utilized the Statistical Package for Social Sciences (SPSS) version 26 as the statistical analysis software. The study found that the financial health of housing development organizations in the Nairobi Metropolitan Area was positively and significantly impacted by building costs (β1=0.018; p-value = 0.000). The financial health of housing development organizations in the Nairobi Metropolitan Area was positively and significantly impacted by operational costs (β1=0.692; p-value = 0.000). According to the study, financing costs had a favorable and significant impact on the financial stability of housing development organizations in the Nairobi Metropolitan Area (β1=0.747; p-value = 0.000). The study concludes that housing development institutions prioritize detailed project planning and efficient resource allocation. It also finds that controlling operating costs is essential for the long-term financial health of these institutions. Housing development institutions should prioritize detailed project planning and efficient resource allocation. It is recommended that housing institutions should control operating costs for long-term financial health. This study recommends that housing development institutions should strive to secure favorable loan terms and explore alternative financing options.
Key Words: Construction Cost, Operating Cost, Financing Cost, Construction, Financial Health
CITATION: Mokembo, J. N., & Kosgei, M. (2025). Housing costs and financial health of housing development institutions in Nairobi Metropolitan Area, Kenya. The Strategic Journal of Business & Change Management, 12 (2), 1368 – 1386. http://dx.doi.org/10.61426/sjbcm.v12i2.3177
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DOI: http://dx.doi.org/10.61426/sjbcm.v12i2.3277
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