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.
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.