32-year-old Brian Gacari is the CEO of Property Reality Limited
(PRC). He founded the property development company in 2009 with the aim
of making it a reality for Kenyans to own property and has sold
thousands of property since.
The real estate guru speaks with JACQUELINE MAHUGU on basic tenets that one needs to adhere to when buying land
There are a couple of steps you need to take when investing in real
estate. The first thing, is that you have to go see the land. Visiting
the property is paramount. The second one is that you have to get and
verify the documents.
The documents are the title deed, and then you also have to buy a
survey map from the registry, not from just anyone. From my own
experience, I have learned that if you're getting documentation, get it
from the registry, not second-hand sources, otherwise you will get
conned. You cannot trust anyone.
2. Do a formal and informal search
Call a surveyor and confirm the size of the land. Go round with
the surveyor and find out if that is the acreage that is on the title
deed. This is the Government search.
Then do an informal search. That's when you ask the neighbours
who the property belongs to. It is important nowadays to involve the
family that you are buying from. You never know what is going on within
the family regarding the property.
You might find someone who is age 60 or 70 who now wants to sell
his land and enjoy life, yet the children have different ideas about
inheritance and this can bring problems. After that, look for a good
lawyer who drafts the agreement between the seller and the purchaser. If
the seller has a lawyer, you can liaise with him too.
After that, you are good to go. The other alternative is to look
for reputable firms like ours that have sold property to thousands of
Kenyans.
To know if a firm/agent is reputable, find out how long the firm
has been in existence, get reviews, visit their offices, engage them and
also let your lawyer engage them. Reputation is key.
3. Work with professionals
In the long run, it is cheaper to have a lawyer and surveyor than
to not have them. As professionals, they are able to protect you and
your interests. Unfortunately, people try and run away from that cost to
save money and end up losing a lot more.
The surveyor verifies the property, then the lawyer drafts the
agreement between the seller and the purchaser. However, you can also go
to a reputable property firm, which would ideally have all these things
in-house. Ensure that they are real professionals, not quacks.
4. The outskirts are where it's at
In the mid to high-end market, the prices will stabilise so more
people will eventually afford to buy. Nairobi now has an excess of
office space, which, to me, is a sign that things are going to
stabilise.
The most likely scenario is that the prices will come down to
attract a larger clientele. Right now in the market you can find better
deals than you could two or three years back.
However, in the outskirts like Kitengela, Athi River, Thika, Juja
and Ruiru, prices will keep going up so investors will have higher
returns there. Think about it; where will your children and your
grandchildren live? The population is growing and there are more people
coming into the country.
As the population grows, people will move to the outskirts, so
these places will continue to expand. We do a survey annually and on the
last one, we studied Ruaka and how much investors gain there. Our
research showed 300 per cent in returns. You cannot get that in Nairobi.
5. Strike while the iron is hot
It is always cheaper to buy property as soon as you can. Buy it
at Sh4 million now because three or seven years down the line, that
property will be Sh8 million.
There is also a lot of Government infrastructure coming up, like
the railway. We have been able to sell many properties along the Nairobi
– Mombasa railway, especially in the new town called Emali, which is
really growing fast.
6. Invest in other urban areas
More people are moving to urban areas like Mombasa, Nakuru,
Kisumu, so those places will give you a higher return in future. Also,
there is a lot of opportunity if you invest in rural towns, because
presently, the county governments are driving development.
New schools are coming up, bringing up the economic activity in
the areas and that is a good thing for an investor there. However, you
get higher returns around the major cities because the population is
more and there is still more rural to urban migration happening.
7. Do your homework
To know if you are getting a good deal, do internet searches.
Look around and find out what other locals are offering. Compare prices.
There are many ways to compare – you can look at the site, then find
out what the neighbouring plots are being sold for.
8. Invest wisely
I do not think there is any asset that you can buy that grows in
value like real estate, even in as little as two to three years, unless
you invest in a good business. Take a scenario where land in a
fast-growing area was going for Sh350,000 five years ago and you bought
three properties then for Sh1.05 million. In five years the cost has
risen to Sh2.5 million.
So if you sell two of those properties, you get Sh5 million and
you can build a house with that Sh5 million without having to get a
loan. When it comes to real estate, thinking ahead is the clincher.
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