In every market segment, there are always buyers vs. sellers with different interests, but they work together, so each person achieves their goals. However, in some instances, the market favours the buyers, and in other circumstances, it favours the sellers.
The real estate market in Kenya has been booming due to higher population growth. That's why in some instances, sellers have the market favour due to high demand. According to Statistica, the real estate market grew by 6.1% by the first Quarter of 2022.
This guide will show the buyers' vs. sellers' real estate market in Kenya. It will help you make the right choices when investing in property.
What is a Buyer's Market in Real Estate?
A buyers market shows that the property favours buyers at the moment. The buyers' market favour happens when the properties listed for sale are more than those willing and able to buy. These circumstances force the property sellers to reduce the price. After all, they need to make money. However, these circumstances are rare in Kenya since citizens try to own homes.
Real estate investors who need to get high returns on their investment will hold a little bit longer to wait for the right time to sell their property. And that could bring down the buyer's market if most investors choose to wait.
As a buyer, you need to negotiate further when buying property. You should also research the price tags of the houses in the neighbourhood to ensure you are getting a good deal. In addition, always check the house's condition to know how firm you should be with your negotiation.
In Kenya, buyers have the right to inspect the property they are planning to buy, and they can also set up contingencies in case something goes wrong during the purchase.
How to identify a buyers market
As a property buyer, you should learn to identify the best time to purchase your desired home. That's why you should be keen on the following signs.
When you find so many houses for sale in a certain region.
General home prices. If there is low demand, prices go down to attract demand. And you should buy before the prices hike again.
High interest on mortgages. When home loans are expensive from all banks, fewer people will not risk getting the loan. As a result, the demand will reduce, and the sellers will reduce property prices.
What is a Sellers Real Estate Market in Kenya?
A property seller's market favours the real estate investor. At this point, the demand for housing is so high that it exceeds the current houses for sale. If you've invested in properties for sale, it will be a good idea to sell them at the peak of the seller's market. At this time, you'll earn the maximum possible returns on investment.
You don't have to be desperate to sell your property since you may even receive multiple bids from people willing to buy. You should work with someone who has attached a proof of funds letter, which will help you save time and sell more properties.
The sellers go with the highest bidder with a proof of funds letter. Therefore, buyers donât have much to bargain with when itâs the seller's market. In Nairobi, it's like a property seller's market because the houses are in demand due to the large number of people working in the city. Most houses are listed in Kitengela, Mlolongo, Ruiru, Limuru, and other metropolitan areas.
How to identify a seller's market
As a real estate investor, you should be keen to notice the sellerâs market because here is where you get your profits. You can always wait for the right time to sell your property. After all, your property doesnât expire. All you need to do is maintain the quality standards of your properties.
Here is how you can easily identify the seller's market:
With few houses and a lot of demand, investors get multiple bids from property buyers.
You can hear from your investor groups where you share industry trends.
When the economy is doing badly, at these critical moments, people focus more on maintaining what they have, so the frequency of building new houses will be low. As a result, the current house prices will drastically increase.
To Sum Up
Itâs a good idea to target the market you are interested in. If you are a buyer, focus on buying your property at a cheaper cost. Also, ensure you bargain to the maximum and save as much as possible.
If you are an investor, always have patience and sell your property during the seller's market. This criterion will help you get maximum returns on investment from your property business.
Frequently Asked Questions
How is Kenyaâs property market?
The property market is on the rise due to the large population in the country. Houses are in demand, either for renting or buying. That's why investing in Kenyan property can be an excellent idea to help you gain financial freedom.
What is the best time to buy a property?
The best time to buy houses or commercial property is during the buyer's market when the demand is low. Use the tips in this article to determine a buyer's market.
Is real estate investment a profitable idea?
Yes. If done well, property investment can make you a lot of money, such that you can retire early. You need to follow the correct guide before starting the investment.