Title:
INFLUENCE OF INTEREST RATES ON PRICING OF RESIDENTIAL HOUSES INNAKURU TOWN, KENYA.

Authors:
Winnie J.Chemirmir

Abstract:
Kenyan real estate market has been experiencing growth in the past ten years and the latest findings have shown that the trend will continue into the foreseeable future. More specifically the study was examining the interest rateson pricing of residential houses in Nakuru town, Kenya. Theory that was used in the study was Classic theory of Interest Rate. The study employed explanatory research design. The researcher adopted a census where all the managers in the real estate agencies and companies were taken as the study’s respondents. Data collection was done through use of questionnaires constructed on five point likert scale. Statistical package for social sciences was used to analyze the collected data. The questionnaire was tested for validity and reliability where Cronbach’s coefficient. The study examined that interest rates did not have a significant relationship with pricing of residential houses in Nakuru. Regression analysis showed that interest rates significantly 19.9% of the variation in house pricing in Nakuru. The study recommended the banks should take advantage of the increasing demand for home ownership by bringing down the interest rates on loans thus attracting more people to take up loans thus creating more profits for the bank.