Author: Peris Gachago

The goal of any investment is to make profits-huge amounts of profits. Accumulating wealth is not a walk in the park or overnight dream. It is a slow by slow process and not a quick one. There are different ways in which wealth can be accumulated, if invested in wisely with proper strategies, persistent and using the right systems. Real estate investment has high returns. Accumulating wealth through real estate requires knowing the process clearly because one mistake would cost you fortunes. It involves huge capital but entrepreneurs who start with little capital still make it through. With lots of effort and plan, the whole process eventually gets off the ground and investors make it. Here are some of the ways in which one can make it in Real Estate through.

Through flipping

One of the ways to make quick money in real estate industry is through flipping. This is how it works; you buy a house, repair it and make renovations, hold it on for a short period of time then sell it. It is quick to fix kind of method. However, you need to be careful on this type of method because while buying a house you could underestimate the cost of repairing and this would probably lead to a loss or no fast client is you over value the house. Before buying, it is advisable to learn the market tactics and have in mind the buyers expectations too. That way, you can practice flipping of property in a safe way.

Rental Property Investment

There is different investment in real estate industry and rental property is one of them. This type of investment allows you to leverage long term buy and hold residential properties. One of the basic human need is shelter. With the current economy, people will have to work and be closer to where the opportunity is. This means that migration from one place to the other will always be there creating opportunities for rental investments. Among the other types of the real estate developments, rental investment surpasses them all because there is a steady generation of cash flow. You know that in every month, there is always some coins through rent.

Crowdfunding

Real estate crowdfunding includes allowing enterprise to raise capital through individuals. It involves real estate developers and investors. Developers may identify opportunities and request individual investor to chip in, in terms of capital. It may be limited in terms of; not available to everyone.  In exchange for their money, investors receive debt or equity in a development project and, in successful cases, monthly or quarterly distributions (Business Insider Africa).

Agent/ Wholesaling

An agent is a middleman between the buyer and the seller. You could be the buyer’s agent or the sellers agent. An agent could work in terms of commission, that is get the property a buyer or the other way round; try look for specified type of property for your buyer. The amount they charge is the commission and this could accumulate to wealth easily. For wholesalers, they can get into a contract to buy a certain property but find an investor who is willing to pay more. The amount between the contract and the amount the investor pay extra is the wholesalers money. This could easily help one accumulate wealth.

Conclusion,

Accumulating wealth might take long but eventually you will get there. Real estate involves learning the market of property, gathering the experiences on the same. It is necessary to point out that persistence, determination and discipline keeps you in field too. You could also act as the person to lend money to real estate investors and harvest the profits through interest earned as well as buy shares from real estate related company. You could also get paid by being a property manager by starting your own property management company. Always remember Patience Pays.

Have you decided to buy your first rental property? Are you new to this type of investment? Is it safe to invest in real estate industry? One of the industries with highest returns is the real estate investment. You can never go wrong on this as it shows most of the wealthiest people have as well invested in it. Yes, is the answer to if it is safe to invest in real estate industry. You can never go wrong in this. However, you need to learn the process of investment in the industry and the tactics that would be involved in order to prosper in the industry.  Here are some tips on buying your first rental property;

Right Location

The heart of real estate investment is the location. The location determines a lot in relation to the property. It determines accessibility to social amenities as well as the value of the property. Investment where the area is not growing-that is in population wise and infrastructure-will have your money stuck instead of appreciating. While investing in real estate, it is advisable to invest in areas with amenities such as water, electricity, easier transportation and accessibility to working zones as it will attract more renters.

Calculate your Returns

Before investing in rental property, it is wise to determine the rate of returns of the investment. Calculate all the operating costs; in terms of expenses and profit. Also, project the earning in years. You will be able to determine whether the investment is long term or short term invest-whether worth in future.

Determine rewards against risks

By determining your rewards against your risks, you know whether the investment is making sense to you or not. Some of the rewards include the value of real estate increasing translates to the value of your investment rising. Another one is that real estate investment is more stable than investing in stock markets as it can withstand most if the crisis time. You invest in physical assets rather than products you cannot see or touch. On the opposite note of rewards, rental income may not be able to cover all the mortgage value and may need for you to find other sources of covering it, making it one of the risks. Rental property is about the tenants. If one of the spaces is not occupied by a tenant, you may be required to pay the expenses still of the same space by yourself.  Another risk is that in case of immediate cash, you cannot sell real estate rental properties off faster unlike other investments like stock.

Regardless, there is need to know the worth of the rewards against risks worth.

Low cost rental property

The higher the cost of rental property, the higher the expenses. It is necessary to consider buying a rental property with minimal expenses. Remember the goal is to have minimal expenses while harnessing high profits.

Buying on cash versus financing it through loans

When it is your first rental investment, you may be wondering if the best idea is buying it through cash or financing it through a loan. This however depends on your investment goals. Buying in cash can be more advantageous than financing through a loan as it can develop a positive cash flow. Financing through a loan may have several expenses such as interest rates which is not applicable if bought through cash.

Factor in unexpected costs

Real estate investments have several hidden costs. It is necessary to think of such costs and know how to factor them in. For example, you might buy a rental property near a road and soon the road needs to be adjusted, how will you factor in such unexpected cost? Before investing therefore, it is necessary to know what to avoid and what to consider.

Investing in rental properties is one of the best ideas one can enter into. It is important to consider the pros and cons of these types of property especially if you are doing it for the first time.

You may be wondering how you are going to start your real estate business in Kenya or the primary or fundamental ways in which you could invest in real estate in Kenya, worry no more. It may be clicking your mind about, how much money do I need to invest in the real estate or how do I even start it? That kind of confusion is almost in every sector of the business or rather when you need to start investing in real estate in Kenya. We will help you out when it comes to real estate business in Kenya and help you note the basics requirement for such type of investment.

Financial State

One of the ways to get started is to identify your financial state. Real estate investment in Kenya has different ranges of amounts to invest. As a person interested in investing in real estate business in Kenya, you need to evaluate your pockets. People start by buying a piece of land in remote areas, others start with buying a house in the middle of the town. All this however, depends on the financial capabilities of the investor. You need to understand where you lie and at least do market research on costs of properties in Kenya, which will give you a good start. According to haofinder.com, you need to let get your finances in order. This will help you understand what you want and eventually when you invest, you will have done it according to the way you wanted it to appear. 

Choose the type of real estate investment

Real estate investments have a wide variety. Mostly in Kenya, it is mostly stretches from land and its improvements either through investment in industrial property, residential property or commercial properties. Whichever way you choose to follow, the basic step in real estate invest in Kenya is to decide the way first. This way, it will guide you in the different researches you are supposed to follow and the least amount of money you can feed into such an investment.

Location

While starting up your real estate business in Kenya, location matters. Location actually matters in all kinds of business. In one way or another it is influenced and again influences the target population/clients. Where your target audience is, that is the ideal location for your real estate investment in Kenya. Location also dictates the amount of money to put into your real estate investment. For example, a residential type of real estate investment in Kenya would be cheaper than industrial type of investment if placed in the same location. However, a residential type of investment would be expensive if placed in urban areas such as Nairobi when comparing to an industrial investment that are placed in remote areas. All such factors fall under the location of the investment and relates to the few things that matter a lot to real estate investments in Kenya.

Finally,

These three tips are very essential in helping you get started when it comes to real estate investment in Kenya. If you are stuck or have any questions related to starting up your real estate investment in Kenya, do not hesitate to reach us through https://property254.co.ke/do not be worried again on how you can start up a real estate investment in Kenya.

At these tough economic times in Kenya, you may be thinking of indulging yourself into the real estate business. You may be wondering how much you need to invest or how much you should have to make a move on you first real estate investment in Kenya. Real estate investment requires a lot of persistent since it is a huge investment. Every type of business has its highs and lows and real estate is not an exceptional. When it is your first time in real estate, you may have gathered some much advices out there that may or may not work in this industry. However, real estate investments in Kenya are one of the ways of becoming wealthy and the industry is very lucrative if done right and resourcefully.

Real estate in Kenya covers a wide range including buying property for resell or for occupation, it may involve buying land and diving it into sub portions for selling among others. It may be land, residential, commercial or industrial. Whichever part of real investment you want to start up, here are some of the few things you need to look at to determine how much you may need to have your first real estate investment in Kenya.

Deciding on the type of property you want to invest in

As stated above, real estate investments have a wide range; from commercial to industrial to residential and to bare land that adds its value over time. First, you need to decide on why you want to enter into the real estate investment in Kenya. Buying a piece of land to subdivide later is cheaper than buying one for comer use or industrial use. When buying a piece of land again depends on your location preferences. Recently, areas that are considered as metropolitan or rather near Nairobi CBD may fetch a lot of value on land than those a little bit far. Such areas include; Juja, Ruiru, Syokimau, Kitengela, Kikuyu, Kiambu and along Kangundo road. Half an acre goes around 1 million to 3 million depending on the amenities.

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Evaluation of finances

Once you have decided on the location and the property you want to invest in, the next step is to evaluate your finances.  This is the step that tells you how much you need to have your first real estate investment in Kenya. There are two ways of working it our; buying it with the amount you have save up or mortgage which translates more to a loan. In Kenya mortgage way, owner occupied type of investments may need less amount of down payment which is usually 3% value of the property compared to investment properties. Mostly in investment of residential to rent out, commercial or industrial Kenyan banks may require 20% to 30% of the down payments. Exploring the market on how much the land would cost {varying in different locations}, the deciding on the type of real investment you need to enter into, then you can easily decide on which type of financing you can do.

Hidden costs

While you may be having the anxiety starting up real estate investment, you need to consider any cost that flows with that industry. It will be one of the major things that determines how much you can invest in real estate in Kenya. Any type of real investment may require maintenance costs, transfer costs, agent fees, mortgage payments as well as taxes especially on land that includes land rates {Land rates are levies imposed on all parcels of land and payable to the county governments. Upon full payment of all rates, one is issued with the rates clearance certificate which is conclusive evidence that all rates due and interest accrued have been fully paid}

Such costs will greatly influence how much you need to invest in real estate in Kenya.

In conclusion, while you need to calculate the total amount you need to invest in real estate, consider any hidden costs as well as places to invest in Kenya and factors that affect the real estate investment in Kenya. You can also visit our website https://property254.co.ke/ and register with us so that you could have a full guide on real estate costs and affordable agents with vast knowledge.

Like any industry, real Like in industry real estate has its own disadvantages and advantages. there are different factors that affects the real estate industry. Some of these factors include;

·         Demographics

·         Government policies

·         Economy

·         Interest rates

Real estate industry accumulates one of the highest industry in terms of wealth. The industry in itself is huge and that’s a lot of profits which makes it easier to be attractive to people.

The demographics

On demographic of real estate buyers,there is provision of age, income and preferences. It shows the percentage of buyers in terms of the youthful buyers as well as the aged buyers. Older People tend to buy or rather invest in real estate industry in comparison to younger generation. On the same note, the type of real estate investments can be determined since the younger generation will work and focus on the investment that brings back and generates more income. The older generation will be looking for type of investments that suits their vacation needs. They are more focused on luxury type of investments. The higher the percentage of retirees that can afford a certain type off real estate investment, the higher the likelihood off the industry increasing the prices.

Government policies

Legislation is one of the factors that can also affect the real estate investments. High taxes on residents can consequently affect the investment. Imposing too much costs on real estate industry, can lead to the demand of the property lowering. However, the government can equally ease the burden of such problem by reducing taxes, offering subsidies to property as well as giving tax credits. The government can also offer deductions on the raw materials that are involved in the real estate industry. This will therefore increase the demand of the investment and encourage wider the margins of profits.

The economy

Another factor that determines the value of real estate investment is the economy; that is the state of the economy. The economy is defined by the gross domestic product, the price of goods as well as the accessibility of raw materials. Different types of real estate investment as discussed in our previous blog, can be influenced by the economy differently. A recent example, is when COVID-19 did hit the economy the hardest. The investors that had hotels as well as renting out had the low demand because the tourism industry was as well affected. On the other hand, real estate investment in terms of commercial property and industrial property were less affected because normally these types of investments have a longer lease time had residential type of property investment. In short, when the economy is ailing so is the real estate investment.

Interest rates

Interest rates can also in a bigger margin affect the real estate investments. For example, if you’re considering to buy a property using mortgage, then it is advisable for you to research on the different rates of interest that would be accumulated by the mortgages. Any change in interest rates can determine the ability of a buyer to purchase a certain property. For example, when the interest rates are lower so is the cost of acquiring the mortgage which leads to higher prices and higher demand in housing as well as other real estate investments. In the same way if the interest rates are higher the cost of acquiring a mortgage is higher which therefore reduces the gap in real estate investment and lowers the demand of such investments. Therefore, if there is a need to invest in real estate industry, it is necessary to understand the different types of markets that would favor your investment. All these markets are determined by the interest rate and may favor either the buyer, the seller or maybe a neutral market.

Advice; Check on these factors and how they affect value and pricing of property before entering the real estate industry.

Whether you are the buyer or the seller, it is reasonable enough as well as essential to have a guide on the specific issues you would like to ask your real estate agent. You maybe wondering what to ask in different stages of the process.  Real estate in itself is quite a lengthy procedure. You may know what to ask while house viewing, another one may want to have a clarification during renting, another may want to know while selling and others while buying. In short the whole process is a huge one and different questions may pop at different stages, some before consulting on whether to involve real estate agents and others on when they have already involved the agents. In whichever situation, one thing however stands, there are common questions that would address a lot of your doubts in real estate industry. In this blog, we will look at both essential questions to ask as the seller and the ones to ask as the buyer.

What to ask your real estate agent as the owner of the property

On experience

Being the owner of the property and you need to sell it off, it is necessary to ask the real estate agent about their experience. Ask them about how long they have been in the industry. This will show you if they are in a position to know the market and have the knowledge. This gives you confidence on the agent you are dealing with and on assumption that your property will be sold easily.  They already have the client base or networked a lot. This also will help you identify the agent’s testimonials as well as their reviews on the different types of property they have dealt with before.

Charges

In every business that involves an agent that you indulge into, make sure that you know their charges. It is important to agree on the pricing, how they will charge you to avoid future misunderstandings. Also, after knowing their experience, and on charging note, you could ask them the range of properties they sell and the charges attached to them.

On advertisements

Ask your agent on what platforms they will be advertising your property from. Ask them where they will list them. As you decide on your agent, note the one who does things in a holistic manner.  The one with professional photography.

On advice

A good agent will advise you on several factors that would increase the value of your property.  They will advise you on tips of how to improve your home and its value. They will advise you on the method that would easily sell off your property, whether through auctioning, expression of interest or through a treaty.

What to ask you real estate agent as a buyer

The owner of the property

There is need to know the owner of the property you need to buy. This avoids controversies and reduces the chances of being conned. It also gives you a basis of where to place your pricing. The owner maybe selling out of desperation or moving to a different place and that would attract a lower price. Asking about the owner also gives you some degree of confidence. This question will also pop the question if why the owner is selling. By knowing the owner too, you will understand about how long they have stayed in the same property as well as whether the property had multiple owners.

Costs

Ask you real estate agent on the total costs that would be associated with the property.  These includes; the appraisal the property itself, inspection, insurance, mortgage interests among others. This will help you determine whether you want the property or not. It also gives you an idea of how you will bargain the property and estimate the total closing costs.

Market

As a buyer, ask your real estate agent on the market. Ask them on how markets favor you. Get to know how long the house has been on the market. If it isn’t a fast moving one, you may want to find why. Also, find out the value of the house, it may be extremely over valued. It will also help you understand what is included in the sale and what is excluded. 

In conclusion, before you either buy your property or sell it, try find put information on the process. It will help ease everything out and you will not feel stuck.

In case you are interested to join the real estate industry, it is important to have a guide and direction so that you can determine where you feel suits your purpose. Real estate industry is diverse and classified into various categories as we will see below. The industry is quite old and new interested investors may not be aware of the different categories that the industry plays around. Each of the different categories of real estate industry has its own advantages and disadvantages but the goal is to find which suits most of your purpose. Whether your purpose is owning, flipping, renting out or developing it, the following are the different categories of real estate investments intent;

Commercial Category

This category of real estate investment is seen with the intent of generating profits or for business oriented activities. This type of investment is mostly practiced to lease out to business owners especially office spaces and skyscrapers. The goal is to pay for the building-that is rent. It focuses on big companies and has stability in its cash flows. Most of such buildings have conditions attached to them while being rent out. They are commonly found in towns and centers that have a huge flow of economic activities.

Industrial Category

This category of real estate investment focuses on property that is used for production and manufacturing purposes. Factories, warehouses and commercial buildings that are focused on production process are placed in this category. They include; research centers, development parks, warehouse as well as heavy manufacturing plant buildings and property associated with industrial parks.

Residential Category

As the name suggests, this is the category of real estate investment where property is focused for residential purposes (living purpose). They include houses, apartments or townhouses with the purposes of sheltering, whether a single family of a multi-family residential sheltering.

Retail Category

This category is characterized with sizable stalls that are mostly for business use. In Kenya, some of these are semi permanent especially if outside the city while those around the city are permanent. The owner may have direct interaction with the tenants or alternatively hire an agent. They are mostly suitable for middle class earners. 

 Mixed Used Category

An investor can choose to have all the above and blend them in such a way that they fit in one space. According to commercial Kenya, mixed use complex is a development, a building, complex of buildings that is developed for mixed use by a private developer or those who combine the above four categories into one single project.

In conclusion,

Understanding your purpose of investment and all the risks that are associated with them, it will be easier to plan on what you need and how to generate profits.

To create awareness of your real estate business, then marketing has to play a great role in the business.  Today’s investments are highly competitive and for you to stay in business of real estate investment, being smart and having the correct strategies will keep you sustained profits. With the increased technology, finding the right marketing strategies while still being persistent will have you achieve your long term goals and objectives. 

Engaging with Professionals

First, an essential way of building up clients in real estate industry is to have professionals that are experienced by your side. This will ensure the trustworthiness of clients. By them making a great review of you, it is easy to create a group of online clients. This increases your chances of online marketing especially on your local marketing strategy. Great marketing skills will lead to faster selling of property and that is all we all need. Being innovative and creative in marketing can help you network easily.

Content Marketing

Another way of marketing your real estate business is engaging in content marketing. Content marketing is where you hire external sources to market on your behalf.  It helps you bring a lot of people to talk about you. Visitors write blogs that would promote your content and this is one of the most ideal ways of marketing.  Such kind of marketing should have very professional standard that is unique, innovative and creative so that it can easily link up to other professional sites, so that they can talk about you in their blogs. As much as people would talk about your work on their blogs, remember you need to have content by yourself in your website too.

Referrals Platform

Third way of marketing you real estate business is by creating a platform that would attract referrals. Real estate business is a huge process and requires referrals to different sectors that is, the lawyer, the seller, the buyer, the agents and all categories of people involved. You could make your webpage in such a way that after some successful transactions, your client could refer their friends. Similarly, you could engage clients directly by telling them to help spread the word about your work. In order to appreciate such referrals, you could give ‘appreciation tokens’ to clients who refer their friends to you. This will keep you sustained in the real estate investment. 

Creating a Proper Brand Awareness

Another creative way of marketing your real estate business in Kenya includes creating a brand awareness.  This also includes the naming of your company. The name can easily attract clients which will similarly attract clients. Focusing on your brand awareness and having a creative logo helps attract clients. Looking at your brand professionally makes it easier to build your real estate business.  Brand awareness helps you convey a message to your clients.

Blogging

Blogs are similarly another way of marketing in real estate industry.  Writing about local market trends, focusing on letting your clients know what is advantageous over the other in the market, helping them identify the favorable markets can equally increase your chances of success in the business. It is important to understand the content you deliver to tour clients in your blogs. Be knowledgeable and of value to what you deliver to your clients.  This will increase you level of searches in the real estate markets as well as increasing your popularity.

Professional Website

Creation of a professional website is also another way of real estate marketing. List all the important information that you may need and how clients would easily get to you.  This will enhance your marketing skills. Also, keep the web page active. Updating your clients on what you have listed will help them understand what you are offering and will have few details that would need clarification. In your webpage, do not forget to add clear photos and videos. Visualizing of property market is one of the biggest ways that would attract a client. Provide information that is professional and profitable to your clients.

Finally, good marketing strategies will keep you in business.  It is essential to note that strategies change over time and property trends also change over time. Being creative is what that will keep you in business.  Also being knowledgeable will profit you a long way.

Many people invest in real estate because the general trend of property is that it increases in value. As such, your returns are guaranteed over some time. It is important for you to understand these factors before you invest in real estate.

1. Purpose

Before purchasing either land or a building, the first factor is to determine why you are making the purchase. For land, consider factors like: – Is it for immediate settlement, immediate construction or for speculation purposes. Are you purchasing for your use or you would like to resell?  The same case applies to purchase of a house. Will it be a house for you to live in or a house that you may want to rent out?

2. Type

Once the purpose is determined, you then must consider if you are making a commercial, residential, agricultural or an industrial property.  Commercial properties are generally used as outlets for sale and purchase of goods or services or for use as offices. Commercial properties are usually more expensive than residential property and attract different taxes and this impacts on your budget. For houses, additionally consider whether you need to purchase an apartment, townhouse, bungalow or a house with a separate servant quarter.

3. Budget

The budget you have available determines the locations you can afford including the size of either land or building. The budget should be enough to not only cover the purchase price, but sufficient enough to cover taxes, agents commissions and the legal costs of conveyancing.

4. Location

Location is usually the biggest determinant of price. If you are purchasing hoping for returns from increased sale price, then you would need to select property in an area that is experiencing or is expected to have a high price appreciation. If you are purchasing a house to live in, then you must consider a location that is easy to commute, is secure, have social amenities and factors like schools and availability of transport.

5. Property Tenure

In Kenya, there are two main forms of property tenure. These are free hold and leasehold interest. Freehold property gives the owner absolute ownership of the property and does not attract ground rent. Leasehold property confers to the owner a limited period to own the property which can be extended. As evidence of ownership, the government issues buyers with a Certificate of Title for freehold and a Certificate of lease for leasehold titles as a primary evidence of property ownership. Article 65 of the Kenyan Constitution limits foreigners to holding only leasehold titles for a maximum of 99 years but permits future renewals on condition that the subject property held under that title is economically active and it is not required for public use purposes. Any title that is on freehold that is purchased by a foreigner, a company not wholly owned by Kenyans or property held in trust whose beneficiary is not Kenyan changes to leasehold.

6. The current condition of the real estate market in Kenya

Conditions in the property market change from time to time. If you are selling a house, high property prices are a good condition. On the other hand, if the property prices are low, it is a good time to buy and a bad one to sell. Thus, before you invest in some real estate in Kenya, perform some research to find out the prevailing market conditions.

The Important Take Away

Buying property is every Kenyan’s dream and rightfully so.  And is very rewarding. Numerous people have made a fortune investing in real estate. If you want to join the ranks of successful real estate investors, the elements above are the ones which you should actively consider. They can make the difference between a few thousands in returns or millions.