Category: Property Management

Landlord and investors know that owning rental properties is one of the best ways to generate a steady cash flow while capturing long-term growth. The big question is how to get from deciding to buy a rental property to actually renting it out and managing the day-to-day tasks that come with being a successful landlord. There are several important steps you need to take to ensure a smoother process and protect your long-term interests.

1.      Target the right tenants

2.      Screen the potential tenants

3.      Use the right forms

4.      Enhance Professionalism

5.      Manage the tenants issues well

6.      Stay up to date with landlord law

Target the right tenants

Choosing the ideal tenant is always the number one tip for becoming a successful landlord. Whether you already own a home or are considering buying a rental, the first thing you should do is decide what you want from the property. So how can you determine which type of tenant is the best fit for your property? Tenants can be divided into three categories. In order to assist you better grasp the differences between them, we’ll go over them in detail here.

Young professionals.: People in their twenties and thirties will either live Due to the fact that they are earning a full-time salary, they will typically want something of a higher standard than student housing. The majority of young professionals don’t have a lot of money, so they’ll want to live close to the city center where there are plenty of amenities.

Students: Students want to save money and have fun. A furnished apartment near the university or the city center is a must-have for them. A basic set of furnishings is expected by students. Each year or two, the students will move out, and you should expect that they will not take good care of your property

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Families: Space is a significant priority for them. There should be enough room for bedrooms as well as outdoor enjoyment. They may be on a budget, but they want a safe and presentable place to live for themselves and their young children. They will want to make your property feel like their home, just like young professionals, so don’t furnish it and let them paint or decorate the walls. The more at ease they are, the longer they will stay.

If you’re renting out a property, it’s crucial that it matches the type of tenants you’re hoping to attract. To attract more tenants, your property should have good access to public transportation and meet certain quality standards. Before you start looking for a property have a target tenant or it will be difficult for you to find a suitable tenant or to earn the rental income you desire. If you want to attract the best renter, you’ll need to use a range of marketing strategies. They include newspapers, flyers, internet and other sources.

Screen the potential clients

If you want tenants who will take care of your property and pay the rent on time, you need to do a thorough background check on each tenant. You are putting your investment at risk by ignoring this step, which can lead to numerous headaches and costs down the road. Investigate potential tenants if they have a criminal history, employment and rent payment history. In the event that you only avoid one risky tenant, the cost of hiring a screening company to conduct a thorough search in accordance with the law is well worth the investment.

Use the right forms

Once you’ve found and secured the perfect tenant, it’s time to formalize the arrangement with a lease agreement. Landlord-tenant agreements should be state-specific and comprehensive, clearly outlining the duties and responsibilities of both parties. These steps are crucial if the connection between you and the tenant breaks down. To be a successful landlord and to avoid this, make sure your lease and the signing process are as flawless as possible before you sign it off. Below are terms to include in lease or rental agreement:

•  Names of all tenants and occupants
• Description of rental property
• Term of tenancy
• Rental price
• Security deposit and fees
• Repair and maintenance policies
• Rules and important information
• Contact information.

Enhance Professionalism.

As with any other business, property management requires the right professionals to run it. The landlord can manage a few small units on his own, but others will require a team of people. In the case of a landlord with multiple properties, it is impossible to play multiple roles at once, such as accountant, caretaker and manager, and you will undoubtedly fall short in at least one of these. Hiring professionals is essential. If you want someone to handle your rental income, hire an accountant. He’ll effectively manage the accounts, allocate budgets and pay expenses, and give you the monthly report.

In order to be successful landlord, be aware of legal and statutory obligations at any given time. There’s a lot to keep track of, so it’s a full-time job to keep up. Think about paying a real estate agent to manage your properties until you get your bearings in the world of buy-to-let.

Manage the tenants issues well

It doesn’t matter how well-trained your tenants are at the end of the day, when rent is late, a tenant gets into an argument with the landlord or breaks a lease. They will complain and make demands. They may even need to be evicted. You will also need to have a plan in place for when your property breaks down and needs repairs. Landlords deal with these situations every day as part of the business. Hiring a property manager will help you solve the small issues tenants may experience when the landlord is not available.

Stay up to date with landlord law

The laws governing landlords and tenants should also be understood. Landlords must perform certain duties and provide certain services, regardless of the state laws in place. A successful landlord you must adhere to five basic obligations, regardless of where they own rental property. As a general rule, the five main duties of a landlord under landlord-tenant law are as follows:

• Security deposit.
• Ownership Disclosure
• Taking Possession of the Property
•  Maintenance
• Liability

Bottom line

Being a landlord is a lot of hard work. At the same time, it can be rewarding and profitable, as well as exhausting and frustrating. Success is more likely when you take the steps outlined above.

In today’s market, there is certainly no shortage of renters. However, for the landlords, it is about finding the right tenants for their houses who will treat their houses like theirs. Most landlords always strive to fill their properties with reliable clients who will pay the rent on time every month, keep the property in good condition and as well follow the rental agreement policy.

Some Landlords always looking for long-term tenants so they don’t have any trouble looking for tenants each and every month. As much as they try it is not always easy to find such tenants but the outcome always is worth the effort. By complying with the fair housing laws, online advertisement, creating specific tenants screening criteria, and checking potential tenants’ credit scores. Landlords will always look for these tenants and always meet them.

1.      Don’t forget to advertise.

Advertising is always mandatory for rental property owners looking to impress tenants. This can be done both online or even by putting notes on the entrance for tenants to see. Advertising can be done through neighborhoods to help do posting on social media or newspapers. This makes your property to be seen by various people hence increasing the number of tenants knocking on your door.

2.      Offer Building-wide fiber-optic internet connectivity.

Offering high-speed internet is critical to your tenant’s business operation. Fiber optic carries a significant advantage above regular speed broadband with increased consistency speed and bandwidth. Connection adds an average of 3.1% to the property value. This will add good tenants more so people working from home will benefit from your property as you benefit from them.

Performing a good fiber installation in your property is a powerful marketing tool. Your tenants can save money on installation while making good use of the available one. The value of your property will increase more so if your coactivity is of high value.

3.      Setting your Rent Price.

Once you have known how to find your tenants, you will net to set your price range or the type of houses that you have. You will want your price to be competitive with the market. You will have to consider covering your expenses so that when setting rental prices, they are catered for. While setting the price you have to consider your worthwhile return on the investment.

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Try to do research and investigate in rent analysis soft were to help you accurately price your property for your tenants. Consider working or checking the rental prices more so seasonably. When there are winter months tends to be below, so the house price has to be lower.

4.      Getting Photos to Find Good Tenants.

Always include multiple photos include photos of all major rooms to show the clients. Make sure it is tidy and the photos show the best elements of the property that will attract the tenant. Make a photo with good lighting meant that you will consider taking the photos during the day considering natural light. Higher a professional including a floor plan. While taking photos to show the tenants consider including video tours to show more around the house the good climatic environment.

Keep your property description concise. Use short sentences and paragraphs and make sure the text is clear. Avoid using all caps and exclamation marks and ensure the listing is grammatically correct.

5.      Hire a Property Manager.

An experienced or professional property manager or a rental agent knows how to find renters so first. They have the real estate knowledge to help the company set the rental prices, the marketing experience will help reduce the time your property stays vacant, and training to re-organize red flags when reviewing applicants.

Hiring a property manager or a rental agent is one way to find tenants for your rental property for they have good and technics on business language. Advertising your property will be much easy for them for they have a good experience to fill the houses with the tenants of your choice.

6.      Sign new tenants to lease.

Having your new tenants signing a lease agreement form is a very important way of protecting your property and your tenants as well. This is to ensure that your clients are protected and what is protected of them. Using a digital lease is an easy way to take care of this crucial step.  Always check and consider the key points. Always review your property rules and requirement to make sure your tenants understand them.

Make sure both you and your tenants receive a copy of the lease. This will make your tenant be more respectful and stay for long because of good management. Make sure they meet your needs and state and federal requirements.

7.      Understanding the Laws.

Do research on the federal and state laws that covers both the landlord and the tenants. With this, you will have long-term clients who are safe because they are protected by the law and this adds value to your pocket. The fair Housing act specifically outlines constituents illegal discrimination against qualified tenants. It also protects people with disabilities in case you have one tenant this will be important.

 Summary.

Finding trustworthy, reliable, respectful tenants is key to running a successful rental property. Make good advertisements for your home and ensuring cleaning is a priority to good tenants and this should be observed. Learning to find tenants mans a lot like understanding your business and working out towards making a good profit.

Tenants are people to be attracted with good work, learn how to communicate to them and your homes will ever be occupied hence maintaining the work of real estate industry.

1.      Communication is Always Key.

Managing property, the right way is all about transparency, hard work, and communication. Because at the end of it all you have to set the right expectations by going the extra mile of ensuring you have clear lines of open communication. Communication here is the key. Every single dispute affecting the company is solved through communication and determining just what the problem is that a solution needs to be found. When one manages a company the right way, it not only increases your market but also increases your business with referrals and great reviews. You have to be available and respond in a timely manner. Set up templates or a portal on your company website in which anyone who needs will get you. It also makes you receive and respond to any complaints.

2.      Always Stay Positive.

Being a property manager means dealing with a lot of different people. And not everyone you meet will give great energy in return. But our property management tip is to maintain a positive attitude even when things get rough. You will realize when working with real estate investment, the market could one day be on your side and the next day there is a change. Property managers need to understand the market and get to know that this is a normal part of the industry and keep a positive and realistic outlook.

3.      Having a Professional Decorum, Stuff, and more

 The property manager must be physically present visiting all the buildings at least weakly. Managing employees means putting them on their toes and flexible visitation schedules help prevent a building from falling into disarray.

The manager should provide support to the building suppers and staff. A property manager has to do what is best for the building and the community as a whole. A good manager always acts professionally. You will be dealing with different people some doctors, lawyers who deserve a lot of respect as any other person could need. Good communication skills needed to be applied everywhere while understanding all duties that everyone should perform.

4.      Set Price and Expectations.

Once an entrepreneur has control over your property and feels that it is ready to be rented out, you need to set up your rental prices and expectation as a manager. Conduct some research about the average range of prices and the number of properties available.

5.      Big Repairs.

For an inventor to make sure that his managerial working is moving the right way, you have to always check your properties and ensure they are in the right position. You will be needed at one point to conduct different repairs in different sections of the house.

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6.      List of Tenant Requirements.

 In addition to deciding on your monthly income, you need to determine what requirements tenants would like in your property. Always keep in mind that it is illegal to discriminate against tenants. If all those are put into consideration, then it is the right way to manage a property.

  Writing and Reviewing Rental Contract.

Once you have a tenant in mind, it will be time to sign the rental contract for this is another good way of managing a property. You will have to hire lawyers to ensure you don’t miss out on any crucial detail for this is a great idea for property management. Be sure and come to common agreements with the tenants to create a good business flow. Eviction procedures, maintenance details have to be set clear to all your clients.

7.      Regular Maintenance.

All properties will need some maintenances that have to be checked. From simple plumbing repairs to light fixtures, you may expect a tenant call with any issue and that has to consider for good management. Have a good list of contractors who won’t let you down, specific maintenance fund schedule regular check up on your property for this helps in maintaining the property.

8.      Evictions.

No managers or landlords would want to end up in this position but it is possible that one time your property has to go through this. What to do is to ensure that you follow all the required rules. Save yourself from troubles and instead follow basic steps such as.

• Give an official notice
• Read local laws to be sure you don’t break any rules
• File the eviction with the court if the notice terms are not met.

These are some guidelines you need to check as a good manager to keep your property under the law and in good managerial conditions. If a manager checks out the required instructions to manage a property, then definitely, he or she is doing it the right way to secure the business and to protects the clients because both as important in the real estate industry.

In Kenya, you should consider a few things when calculating how much rent to charge for your property. Most investors charge rent in accordance with the area code of their property. For instance, rent for an apartment in Karen differs from the one in Thika. In addition, the size of your property determines how much rent you should charge. 

The Landlord and Tenant Bill in Kenya also has some specifications on how to charge rent in Kenya. In addition, it has both landlord and tenant rights regarding rent payments.

This guide explains:

The factors to consider when charging rent in Kenya

The Average rent in Kenya

Rent negotiations

Let’s start.

Factors to Consider When Charging Rent in Kenya

The property’s location

If it is in a desirable area, you can charge a higher rent. Is it in a popular, central area or a bit further out? Rental properties near colleges and universities have a huge demand. Therefore, rent in those areas can be a bit higher compared to houses in rural areas in the country.

Furthermore, properties in big towns like Nairobi, Mombasa, Nakuru, Eldoret, and Kisumu have higher growth potential. This results from the industrial areas that attract employees across the country. 

As long as an area has a higher demand for housing, the rent is likely to be high than in rural areas with few commercial activities.

The second is the size of the property

A larger property will cost more to rent than a smaller one. Is it a large, luxurious apartment or a smaller, more basic one? These specifications tend to alienate each other on the amount of rent payable. 

For instance, a big luxurious house in Kilelehswa will cost higher than a basic house in the same area. In addition, some big houses cost less monthly rent in rural areas than in urban centers. 

The third is the condition of the property

If it is in good condition, you can again charge a higher rent. The quality goes with the rent range in Kenya. Kenyans like to pay for what they can enjoy. Don’t expect to charge a below-average house a higher rent. 

If your houses are new, you can charge a little higher than an old one. In addition, renovations can help you charge a higher rent. It all depends on the quality of the house.

Consider the market rate for rent in Kenya

This can vary depending on the time of year and the current economic situation. The rent rate in Kenya also varies in different locations. 

In addition, when the demand for housing is high, the rent usually goes up. On the other hand, when the demand is low, especially in less congested areas, the rent is usually low. 

Therefore, you should first study the housing market and trends around your property. It will help you set a reasonable, affordable rent in the area at that specific time. 

What amenities and services are included in the rent price?

Is there a gym, swimming pool, or concierge service included? Some property owners are determined to make renters feel at home. As a result, they provide extra services that the renters are interested in. 

So, if your house has a swimming pool, gym, parking, and a children’s playground, you may have to charge a higher rent. These services should be paid for, but not individually. That is why you have to include them in the rent.

What is the rent range in the area?

Finally, you need to research other comparable properties in the area to get an idea of the going rate. Considering all these factors, you can set a fair and competitive rental price for your property in Kenya.

When comparing rent prices, go for houses similar to your property class. For instance, if the houses are big and luxurious, check similar houses in the neighborhood to compare the rent.

What Are The Average Rental Prices in Kenya?

The average rental prices in Kenya will depend on the location that you are looking to rent in. For example, if you are looking to rent in Nairobi, the average rental price will be higher than if you are looking to rent in a smaller town.

The type of property you are looking to rent will also affect the average rental price. For example, a one-bedroom apartment will typically cost less to rent than a three-bedroom house.

Single houses in Nairobi have a rent starting from Ksh. 2700. These rent amounts vary in metropolitan areas and other towns in the country.

How to Negotiate Rent With Tenant in Kenya

When negotiating rent with your tenant, knowing what you want to achieve is important. You should consider what is important to you, such as the amount of rent, the length of the lease, the type of tenancy, and any other special conditions. It is also important to be realistic about what you can achieve, as the tenant may have ideas about what is fair.

It is often helpful to start by discussing the rent amount that the tenant is willing to pay. You can then negotiate from there. It is important to remember that the tenant may be willing to pay more rent if they are given a longer lease or if they are given a tenancy agreement that gives them more security.

Once you have agreed on the rent amount, you should draw up a tenancy agreement. The agreement should include all the details, such as the rent amount, the length of the lease, the type of tenancy, and any special conditions. Both parties should sign the agreement and keep a copy.

Conclusion

Now, you’ve seen how you should charge rent for your income property in Kenya. Just ensure that you can afford to repay the mortgage with your rent. A 50% rule can help you make the right rental decision after considering the factors in this rule.

Frequently Asked Questions

What is a good rental yield in Kenya? 

A good return on investment in Kenya starts from 7%. But that is subject to many factors, such as the property location and the house’s occupancy rate. Houses in densely populated areas, like near colleges and universities, have a higher yield.

What is the 2% rule in real estate?

The 2% rule implies that the monthly rent should equal 2% of the property’s purchase price. With such an estimate, you will surely get a good cash flow to help you succeed in your property business.

What is the 50% rule in real estate?

The 50% rule implies that 50% of your monthly rental income should cater to all expenses on the property. Pay your mortgage from the remaining 50%, and the balance is the cash flow. If you get a good cash flow, your business is thriving. However, the business is not doing well if you have a negative after deducting all expenses and the mortgage.

Tenants are the sole contributors to your income property success. Without tenants, you can’t even pay the property expenses and the mortgage, leave alone the cash flow. That’s why it’s important to find tenants for your specific properties in different locations in Kenya.

Finding tenants in Kenya can be challenging, but there are a few ways to go about it. This post gives you various ways to help you get tenants who act as stepping stones in your income property business.

Most landlords who have followed the tips in this guide have succeeded in their property business, why not you?

Keep reading.

Tips To Find Tenants in Kenya 

When looking for tenants in Kenya, it is essential to remember that the process differs from other countries. Here are a few tips to help you find the right tenants for your property.

In Kenya, there are different ways of finding tenants. The most common way is through agents or intermediaries. These are people who are paid to find tenants for landlords. They usually have a database of potential tenants and will match them to the landlord’s requirements.

1. Newspapers

Start by advertising your property in local newspapers, like the Standard, Nation, and other papers in the country. This method will help you reach a broader range of target tenants. You can get new tenants who wish to relocate to your area. However, location is an essential aspect of this advertisement method since the newspapers are sold countrywide.

2. Property management company

You can also contact a property management company to help find tenants. In addition, try contacting local real estate agents to see if they have any potential tenants. Real estate agents are the go-to individuals who show tenants and buyers the available houses. Once you talk with them, they may help you, and you can give them a commission.

3. Online sites

Another way of finding tenants is through online platforms such as Property254. These platforms allow landlords to list their properties for free, and potential tenants can contact them directly.

4. Word of mouth

Through word of mouth, you can get potential clients to rent your property. This is where landlords tell their friends, family, and acquaintances that they are looking for tenants, and they may know someone looking for a place to rent.

Factors to Consider When Searching for Tenants

There are a few things to remember when finding tenants.

Do a background check and ensure they have the financial means to pay rent.

Once you have found a tenant you are happy with, sign a detailed lease agreement.

Make sure to include clear pictures and detailed information about the property.

The Pros and Cons of Each Method of Finding Tenants in Kenya

There are four main methods of finding tenants in Kenya: through an agent, online, through word of mouth, or by advertising in local newspapers or on notice boards.

Each method has its pros and cons, and it is essential to weigh these up before deciding which is the best option for you.

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Using an agent or property management company

Using an agent to find tenants can be a good option if you don’t have the time or resources to do it yourself.

However, it is essential to remember that agents will charge you a fee, which can vary depending on the agent and the services they provide.

Through online advertising

Looking for tenants online can be a good option if you are comfortable using the internet and online tools. Several websites allow you to list your property for free, which can be an excellent way to reach a broad audience. 

However, it is essential to remember that not all tenants will be comfortable using the internet, so you may also need to consider other options.

Word-of-mouth advertisement

Word of mouth can be a cheap and easy way to find tenants, but it is important to remember that not everyone will have the same network of contacts. You may also need to consider other options to reach a wider audience.

Local newspapers

Newspapers are still a good way to advertise businesses, especially your income property business. Every day usually has a new paper with trending news. Therefore, you can take advantage of that and pay for daily publishing of your rental property. 

The biggest limitation of newspapers is that the audience is always diminishing. People, even grandmothers, are going digital, meaning they get most of the news online. As a result, they won’t need a newspaper to learn the trending issues.

The Most Effective Way to Find Tenants in Kenya

There are various ways to find tenants in Kenya. The most effective way to find tenants in Kenya would be to use a professional property management company.

These companies have databases of potential tenants and can match you with the right tenant for your property.

They will also handle all necessary paperwork and background checks to ensure that the tenant is a good fit for your property. Other better ways to find tenants in Kenya include online listing sites, classified ads, and word of mouth.

The Bottom Line 

The most important thing for landlords is finding responsible tenants who will take good care of their property.

Finding the right tenant is a great milestone for your income property business. You should also strive to be a good landlord if you want long-term relationships with your tenants. 

Frequently Asked Questions

How can I get tenants easily?

If you want to get tenants fast, you should be aggressive in your marketing. You can use word-of-mouth, social media and websites, newspapers, and real estate agents’ advertisements to get clients faster. Once you combine all those methods, though it will be expensive, you’ll end up with high-quality clients.

Can a landlord evict a tenant?

Yes. The landlord has the right to evict a tenant if they don’t pay rent for consecutive months. If the tenant delays for one month, the landlord can give them a one-month notice, and if they don’t honor their commitment, you can evict them.

How do you attract office tenants?

Offices do well in urban centers. That’s one thing you should remember to succeed in the office leasing business. You can place advertisement banners on newspapers, online platforms, and eclectic posts.

If you are a landlord and have property to rent, it’s important to have a written lease or rental agreement. If you and your tenant have a legal dispute, having a written agreement increases your chances of a favourable outcome. Your lease or rental agreement should include the following items;

1.     Tenants and occupants information

2.      Information about the rental property

3.      Length of the lease

4.      Rent payments

5.      Security deposit and other charges

6.      Rules and policies

7.      Contact information

8.      repair and maintenance 

Tenants and occupants information

It should be mandatory for anyone over the age of 18 to sign and be listed as a tenant on the lease or rental agreement. So, the tenants are legally obligated to pay their rent and to use the property in accordance with all terms and conditions set forth in the lease. Therefore, if the other tenants fail to pay, you can legally demand their entire rent from one of them, and if any tenant violates an important term of the agreement, you can terminate tenancy for the entire group of tenants.

Information about the rental property

Include the full address of the property, including the building and unit number. Also include If there are any specific parking areas. Be sure to include the assigned parking number, for example, if the rental includes it. If the tenants are not be allowed to access certain areas just include it in the agreement.

Length of the Lease

There are short-term tenancies (typically on a monthly basis) created by rental agreements that automatically renew until the landlord or tenants end them (depending on the agreement type) While leases create tenancies that expire after a specific period of time (usually a year). Please note the start and end dates regardless of which method you choose.

 Rent payments

Specify when and how to pay rent, such as via mail to your office, in your contract. To avoid misunderstandings, include specifics such as, acceptable methods of payment (for example, personal check only, bank deposit only), what the late rent fee is (if applicable), how much it is (if applicable), and the grace period (if applicable).

Security deposits and other charges

There are several things you should be clear about if you want to avoid some of the most common conflicts between landlords and tenants: what you could use the deposit for (for example, covering any unpaid rent or repairing damage the tenant causes) and what you won’t accept it as payment of last month’s rent. To find out when and how you will refund the deposit and account for any deductions, check your state’s laws on returning security deposits when the tenants vacate the premises.

Repair and Maintenance Policies

A clear lease or rental agreement that outlines both the landlord’s and the tenant’s responsibilities for maintenance will help you avoid rent-withholding issues and other problems (especially with security deposits). As a tenant, you are responsible for keeping the rental property clean and you are also responsible for paying for any damage caused by your abuse or negligence. The tenant must notify you if there is a defect or hazard in the rental property, with specifics on how you will handle complaints and repair requests

 Landlord’s Right to Enter Rental Property

It is important that your lease or rental agreement spells out exactly when the landlord have the legal right to enter the property, such as when making repairs, and how much notice you will give the tenant in advance. As a landlord its always important to give at least a notice of 24 hours before entering into a tenant’s house.

 Rules and Policies

Do not forget to include any rules or regulations that are so important to you that you’d be willing to kick out a tenant who broke them. It is possible to write other, less important rules in a separate document. These terms and conditions are included in most rental agreements:

7 Tips on how to become a successful landlord in Kenya

Illegal activity: As a way to limit your potential liability and to help prevent injury to others and your property, the contract should include a clause prohibiting illegal or disruptive behaviour, such as drug dealing or excessive noise.

Smoking: If you don’t allow smoking, remember that the ban covers all types of smoking. If you limit smoking, make a list of where and when tenants are allowed to do so.

Pets: If your rental allows pets, include the following policies: Specify the number of pets a tenant is permitted to have, as well as the types, breeds, and sizes of animals that are permitted. Note whether pets must be leashed outside the unit and whether tenants are responsible for cleaning up pet waste in common areas.

Contact Information

Encourage tenants to contact you in writing if they have questions or concerns about certain issues. The use of text messages and instant messaging may be appropriate in some situations, but it is important that you keep an accurate record of all communications with your tenants, which you can print out in the event you need to show a judge. Let your tenants write or give their notice inform of writing.

Bottom Line

These clauses in your rental agreement will protect you if your tenant turns out to be someone you don’t want to rent to anymore. Rental agreements make it simple to evict tenants who refuse to leave the premises. If you are a landlord and you need help in writing the Lease or rental agreement leave a comment, we will keep in touch with you.

Is there  term you think is important? Let us know in the comments section.

Writing out a landlord-tenant contract can be tedious and time-consuming. While you could use boilerplate language you find on the internet, why take the risk? We can support you to draft  a lease agreement for you or houses you manage. Contact us on 0726982982 and we shall give you a  carefully drafted agreement for free.

There are different features that are attached to different types of real estate investment. That is why it is easier to identify a rental property from commercial property or industrial property. in this article we are going to talk about the various characteristics/features of rental property. They include;

Location/ Neighborhood

Neighborhood determines the type of tenants you may have. It also determines the value of property. in Kenya, high end areas like Kilimani and Kileleshwa will have high earning people living in such areas. Low end areas may also attract middle class income people as well as low income people. The population is always higher in low end area. Low end areas may mean areas that are composed of slums. Owning a property in areas such as Kibera (low income region) would be cheaper than owning one in Westlands which is a high end area.

Amenities

The type of amenities found in rental property zone include; schools, hospitals, churches as well as parks. It would not be advisable to have a park in the middle of an industrial area where there is noise pollution and air pollution. Neither could schools work in such regions. Rental property is characterized by access to amenities in a calm and safe manner.

Ps. As a tenant if you need to rent out a place, consider the quality of education offered in the area you are moving to. Also consider the size of the house and your family needs. Security is also paramount when it comes to renting out. As an owner, consider purchasing properties in places with good social amenities and security. Such attracts renters and creates a pull of demand in rental property. it can also encourage you to have a higher rate of return.

Future Development

The mind of an investor should be focused on how their property affects or will be affected by future developments. In Kenya, it is essential to learn the spatial plans of an area (now county development plans). This can help you determine how to adjust your property at the time to suit the future. A good rental property investment region can be equated to a region with high constructions which means potential growth of such a place.

Job Market

Employment is one of the features that determine the fate of rental property. Regions that have high growth in terms of employment have a higher chance of having tenants than the rest of the regions. It is necessary to check job listings such as Brighter Monday, My Job Mag among others and see the frequent job locations in Kenya. This can help you understand that the regions that appear the most are attractive to tenants and also determine that in few years, the prices or value of property may rise.

The final word,

Rental property maybe one of the best types of real estate investments but if not well determined during investment time, the whole process may lead you to incur expenses that were not planned about such as vacancy costs in the first place. It is wise to determine how well investing in rental property gives you returns.

Good houses take a lot of time to find. And once you get one, you may feel reluctant as a tenant to let go of the house. That’s why you may consider subletting your home to a colleague,  friend, or family member while you travel.

However, tenants should ask their landlords whether they are comfortable with subletting. Some landlords can support the subletting if they get their rent on time. Other landlords are so strict with their property and may not consider subletting.

This guide explains subletting and what tenants and landlords should do to keep their lease agreement. 

Keep reading.

What is Subletting?

Subletting is when a tenant rents out their rental property, or a portion of it, to another individual. Subletting is different from the original tenant subletting the property, as the original tenant is still responsible for the property and any damages that may occur. 

Subletting can be a valuable option for tenants who need to move out of their rental property temporarily but want to keep their lease agreement and avoid breaking the contract with their landlord. However, it’s important for tenants to check their lease agreement before subletting their property, as some landlords may not allow it.

The Process of Subletting

The process of subletting a rental property typically involves several steps. First, the tenant must check their lease agreement to see if their landlord allows subletting. If the landlord is comfortable, the tenant can find a suitable subtenant to take over the property.

The process may involve advertising the property, screening potential subtenants, and negotiating the terms of the sublease agreement. Once they find a subtenant, the tenant should inform their landlord of their intention to sublet the property. The landlord can approve the subtenant and the terms of the sublease agreement before the subletting can occur.

Once the landlord has approved the subletting arrangement, the tenant and subtenant can enter into a sublease agreement. This agreement should outline the terms of the subletting arrangement, including the length of the sublease, the amount of rent the subtenant will pay, and any other relevant details.

Once the sublease agreement has been signed, the subtenant can move into the rental property and make rental payments to the tenant. The tenant will continue to be responsible for the property and will ensure that the subtenant follows the terms of the lease agreement and any applicable laws. The tenant will continue making rental payments to their landlord unless the landlord has agreed to accept rental payments directly from the subtenant.

The Benefits of Subletting

There are several potential benefits to subletting a rental property.

For tenants

The ability to temporarily move out of the rental property without breaking their lease agreement or incurring penalties from the landlord.

Subletting can be helpful for tenants who need to relocate for work or personal reasons but don’t want to lose their current rental property.

The opportunity to generate additional income.

By renting out their rental property, even for a short period, tenants can offset some of the costs of their rental payments. This idea is helpful for tenants who are struggling to afford their current rental property or who are looking for ways to save money.

For Landlords

Subletting can help to prevent vacancies in rental property.

If tenants know they cannot occupy the property for a certain period, they may be more likely to sublet the property rather than break their lease agreement and leave it vacant. So, subletting can help to ensure that the property remains occupied and generates income for the landlord.

The Risks of Subletting

While there are potential benefits to subletting a rental property, some risks are also involved.

For tenants, the main risk is that they remain responsible for the property and any damages that may occur while subletting. If the subtenant fails to pay rent or causes damage to the property, the tenant may be held responsible by the landlord and may face penalties or eviction.

Another potential risk of subletting is the tenant’s difficulty finding a suitable subtenant. If the tenant cannot find a subtenant, they may be stuck paying the entire rental payment for the property themselves, which can be financially burdensome.

Subletting can also be risky for landlords, as they may be unsure of the subtenant’s ability to pay rent or take care of the property. If the subtenant fails to pay rent or causes damage to the property, the landlord may have difficulty recouping their losses from the tenant.

While subletting can be a useful option for tenants and landlords, it’s important for both parties to carefully consider the potential risks before entering into a subletting agreement.

Tips for Landlords and Renters

Here are some tips for landlords and tenants considering subletting a rental property:

For Landlords

Check the country’s and local laws to see if subletting is allowed what restrictions may apply.

Include a clause in your lease agreement that explicitly states whether or not subletting is allowed and what conditions must be met for a tenant to sublet the property.

Be selective when choosing a subtenant. Screen potential subtenants carefully, and consider requiring a credit check, references, and a security deposit.

Communicate with the tenant and the subtenant regularly to ensure that the property is well-maintained and that all parties follow the lease agreement’s terms

You may tell the tenant to obtain insurance that covers any damages the subtenant causes.

For tenants

Check your lease agreement to see if your landlord is comfortable with subletting and what conditions must be met to sublet the property.

Take the time to find a suitable subtenant who will pay rent on time and take care of the property.

Communicate with the landlord and obtain their approval before subletting the property.

Create a written sublease agreement that outlines the terms of the subletting arrangement, including the length of the sublease, the amount of rent that will be paid, and any other relevant details.

Be prepared to take responsibility for the property and any damages that may occur while it is sublet.

The Bottom Line

Overall, it’s important for landlords and tenants to communicate openly and honestly and to carefully consider the potential risks and benefits of subletting before entering into an agreement. Subletting can be a useful option for tenants and landlords, as it can provide a flexible and mutually beneficial arrangement for renting a property

Frequently Asked Questions

1. Is subletting allowed in Kenya?

Yes. However, the main agreement is between you and your landlord. The tenant and landlord agreement should have more details about subletting.

2. What’s the difference between rent and sublet?

Rent occurs when a landlord signs an agreement with a tenant explaining the tenancy rules. On the other hand, a sublet occurs between a tenant and a subtenant. The tenant must draft their agreement with the subtenant, but it should contain everything from the landlord and tenant agreement.

3. Who is the main beneficiary of subletting?

Both the tenant and landlord enjoy subletting. The landlord is happy because their homes are not vacant, and the tenant can save some money and maintain a good rental house even after travelling.

With the cost of living increasing day and night, rent is also rising. Apparently, rent is always increasing in cities which are growing fast. A growing economy creates demand for housing, both residential and commercial. There are towns in Kenya where rent is increasing fast. So, this blog explains the cities with high growth potential where rent is rising.

The Cities in Kenya where Rent is increasing

Nairobi city

Nairobi is the capital city of Kenya, with thousands of investments by local and international investors. The city has a population of 4.4 million as of the 2019 census. 

Hence the high demand for housing in the city.

The rent in Nairobi is so high compared to other towns and cities in Kenya. In addition, the cost of living in the capital city has been on the rise for some time now, which is reflected in the increasing cost of rent. 

In Nairobi, the average rent starts from Ksh3000 to above 50,000, depending on the house’s size and quality. Several factors, including the influx of people into the city and the limited housing supply, are driving this increase.

Mombasa 

This city is the second largest in Kenya. It’s located in the coastal region, making it a big tourist attraction site. Most property investors in Mombasa have ventured into the Airbnb business due to the high demand for vacation houses. 

Mombasa’s average rent for a one-bedroom apartment is now around Ksh10,000 to over Ksh30,000. The rent amount depends on the area in which you get your house.

Kisumu 

Kisumu, a city at the Kenya-Uganda border in Lake Victoria, is among the towns in Kenya with high house rents. The town is a known producer of Tilapia fish from lake Victoria. 

Therefore, the city has grown, and it has several private and public learning institutions. 

As a result, rent is increasing in Kisumu, with the lowest rent being Ksh2000 from Ksh1500 in past years. 

Nakuru 

Nakuru is a growing city due to the business-minded people who stay there. There are public and private institutions that lead to the fast growth of the city.

Most business investors consider Nakuru city over other cities, even Nairobi. In addition, real estate investment in Nakuru is on the rise due to the high demand for houses. 

The rent in Nakuru starts from Ksh5000.

Eldoret 

Eldoret is a town at the further end of the rift valley region. The town has grown incredibly due to the learning institutions in the area. In addition, it’s close to big livestock, flowers and maize farms hence a higher demand for housing.

The rent in Eldoret starts from Ksh2000 to above Ksh.20000, depending on the size and quality.

The rising cost of rent is a major concern for many Kenyans because it’s becoming increasingly difficult to find affordable housing. This is especially true in Nairobi, where the cost of living is already high. 

Reasons for the Increase in Rent

There are a number of reasons why rent might be increasing in certain Kenyan cities. 

Increase in the cost of living in that city 

This could be due to a number of factors, such as inflation or a decrease in the availability of affordable housing.

Cities with a high cost of living may have higher rental prices due to the overall expense of living in the area. This can be due to factors such as the cost of groceries, utilities, and other necessities. Everyone is feeling the cost of living, including the landlords. As a result, they raise the rent to help themselves with rental income.

An increase in demand for rental properties 

This could be due to population growth, an increase in the number of people moving to that city for work, or other reasons.  

Whatever the reason, rising rents can be a challenge for those who are trying to make ends meet.

Economic growth 

Cities experiencing economic growth may see an increase in rental prices due to an increase in demand for housing from people moving to the area for work.

Economic growth also increases the demand for raw land around the area. 

A limited supply of rental properties 

A limited supply of houses in an area can lead to an increase in rental prices for the available houses. 

Infrastructure improvements 

Suppose a city is undergoing infrastructure improvements, such as constructing new roads or expanding public transportation. In that case, it can lead to an increase in demand for housing, which can drive up rental prices.

Real estate market conditions

The market conditions in a particular city or region can also affect the rent that the landlord charges. For instance, if it’s a seller’s market, people buy property at higher prices, and they will charge high rent.

The Impact of the Increase in Rent

For instance, the cost of living in Kenya’s capital, Nairobi, is rising rapidly, and so is the cost of renting property. Rent increase is having a knock-on effect on other areas of life, such as food and transport costs.

The situation is made worse because wages are not keeping pace with inflation, causing hardship for many people struggling to make ends meet. The government should address this problem, or it risks creating a situation where only the rich can afford to live in Nairobi. 

What Can Be Done to Address the Increase in Rent

Another option is to build more affordable housing developments that are accessible to a broader range of people. This could involve working with private developers to create mixed-use developments that include both commercial and residential space.

Finally, it is also important to educate people on their rights as tenants and how to negotiate fair rental agreements. This could be done through public awareness campaigns or by providing resources and support to tenant rights organisations.

Frequently Asked Questions 

Why does rent increase in Kenya?

The biggest factors that cause rent to increase are the demand for housing and the cost of building materials. Areas with high demand for housing usually have high rent due to scarcity.

Can renting be better than buying a home?

If you are after flexibility, especially if you move a lot, renting can be a good option. However, it’s not the best choice if you are permanently in an area. It will be better to buy a home or build one

Which cities have the highest rent rates in Kenya?

Nairobi leads in rent, followed by Mombasa, Nakuru, Kisumu, and Eldoret. The rental price depends on the development of the city.

Where you should buy your next property in Kenya is the main determinant of your success in the real estate market in the country. Therefore, you should be keen when choosing a location. 

The most successful real estate investors took their time when choosing where to invest their property business. For instance, those close to big towns and institutions tend to succeed faster than investors in local towns.

This blogger will show you how to determine your property’s location in Kenya. By the end, you should have enough knowledge to select a suitable location for your real estate investment.

Factors to Consider When Choosing a Place to Buy Rental Property in Kenya

Location

The location significantly impacts the real estate market and the success of a real estate business. The property’s location determines the following.

Property values. The value of real estate properties can vary significantly depending on their location. Properties in desirable areas or regions with strong economic growth usually have higher prices than properties in less desirable areas.

Demand for properties. The demand for real estate properties depends on the growth potential of a specific location. Properties in highly desirable areas may be in higher demand than properties in less desirable areas, which can impact the return on investment.

Market trends. The real estate market in Nairobi differs from that of Naivasha because of the city’s potential. Therefore, agents should have a deep understanding of the local market trends to serve their clients effectively.

Access to amenities and transportation. The availability of amenities and transportation also impacts the demand for real estate properties in different locations. Properties near schools, parks, shopping centres, and public transportation are more profitable than properties in more remote areas.

Regulations and zoning laws. The regulations and zoning laws in a given location can also impact the real estate market, as they can dictate what properties you should build.

Research the Local Rental Market Before You Buy

The rental market can impact the demand for real estate properties and the prices in the areas. The local rental market should guide you on where to buy your next rental property in Kenya.

If the competition for properties in the rental market is strong, the rent or the prices can go high more often, making it difficult for renters. As a result, the demand for properties for sale increases. Some renters may decide to purchase a home rather than continue to rent.

The cost of renting a property can impact the affordability of buying a home. If rents are high, it may be more difficult for potential buyers to save up for a down payment on a home. On the other hand, if rents are low, it may be easier for potential buyers to save up for a down payment. Therefore the demand for properties for sale will go high.

The overall market conditions also impact the relationship between the rental and buying markets. In a market with high demand and low supply, both rental and property prices may increase, while in a market with low demand and high supply, both rental and property prices may decrease.

If interest rates are low, it may be more affordable for potential buyers to obtain a mortgage, increasing the demand for properties for sale and driving up prices. On the other hand, if interest rates are high, it may be more expensive for potential buyers to obtain a mortgage, decreasing the demand for properties for sale and driving down prices.

Consider the Type of Rental Property You Want to Invest In

The type of property you are interested in buying can affect your decision on where to buy in Kenya.

For instance, urban areas have more amenities and transportation options. As a result, these areas are more suitable for certain types of properties, such as high-rise apartments or commercial buildings.

Rural areas may be more suitable for properties with more land, such as farmhouses or vacation homes.

The proximity to amenities such as schools, hospitals, shopping centres, and public transportation affects the demand for and value of different types of properties. For example, a family with young children may be more interested in a property that is located near good schools. At the same time, a retiree may be more interested in a property that is located near hospitals and other healthcare facilities.

Can You Access a Qualified Real Estate Agent?

Real estate agents play a crucial role in the real estate industry because they are intermediaries between buyers and sellers.

Real estate agents have a deep understanding of the real estate market. They are knowledgeable about the local market trends, property values, and the legal and regulatory issues involved in real estate transactions. 

Real estate agents are skilled at marketing properties and negotiating deals, and they can help buyers and sellers get the best possible price for their property.

Buying or selling a property can be a time-consuming and stressful process. Therefore, a real estate agent can help manage these aspects of the transaction and take some of the burdens of the buyer or seller.

Real estate agents have access to a wide network of contacts in the industry, including other agents, lenders, appraisers, and other professionals in the market.

Real estate agents should adhere to strict laws and regulations, which help ensure that all necessary documents and disclosures are intact to protect the interests of their clients.

Conclusion

It’s important to research with the help of a real estate agent whenever you want to buy property. Location is essential in the real estate industry. Therefore, don’t take it lightly when searching for property. 

We can help you get the best locations for the type of property you want to invest in Kenya. Remember that a good location is the main determinant of your success.

Frequently Asked Questions

How do I choose the best location for my property in Kenya?

A location with evenly distributed social amenities close to big towns and institutions is the best to thrive in real estate. 

What is the best place to buy land in Kenya?

The Nairobi metropolitan areas like Limuru, Kiambu, Mlolongo, Athiriver, Kitengela, etc, are good places to buy land in Kenya. However, what you need to do with the land determines the location. For instance, urban areas are suitable for commercial and residential real estate. On the other hand, if you want to invest in agriculture, rural areas are the best.

What seems to be the fastest-growing city in Kenya?

Most researchers have concluded that Nakuru is the fastest-growing city. People living in Nakuru strongly believe in business, hence the growth.