Somali Pirates Blamed for Kenyan Housing Boom

Take that, hedge fund managers!

Capitalizing on what appears to be THE hot career for 2010, Somali pirates, flush with $100 million in ransom money, have apparently started to inflate home prices in Kenya's capital city of Nairobi.

In a neighborhood known as "Little Mogadishu," business and apartment buildings have sprung up to provide for the growing Somali community.

One anonymous Kenyan real estate agent told the Associated Press that Somalis are known for paying double what a property is worth so as to avoid scrutiny.
On the one hand, ill-gotten gains are always going to be laundered into businesses or property. The same thing has happened in America during the boom time when drug dealers and other criminals would buy houses or cars or boats for cash. It may happen even more now, as sellers are desperate!

On the other hand, their may be a populist political motivation here for Kenya to go after Somali ex-pats who are seen as being tax dodgers, while blaming them for making homes in Nairobi "unaffordable."

In some ways this is similar to efforts in the U.K. to put higher tax rates on ex-pats from Russia or the Middle East.

Hey, Somali pirates are welcome to come to my open house this weekend if they make a cash offer for double of what I'm asking!
Read Full Story

Find a home

Powered by Zillow