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House on sale with a lease-back option
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MaichBlack
#21 Posted : Thursday, September 25, 2014 9:39:15 AM
Rank: Elder


Joined: 7/22/2009
Posts: 7,455
FRM2011 wrote:
MaichBlack wrote:
Why buy a house and make 5% ROI???

If you dream is to eventually own a house in that area, simply buy a plot in the same neighbourhood and put the rest of the money in a better yielding investment. For crying out loud, even a bank will give you double that ROI on fixed deposit account!!! And there are much more lucrative investments than fixed deposit any how!


Weeee Maich mweusi, I thought we had a deal you stop kuharibu soko in the other thread.

The house was sold by a broker who made a cool 350k in less than a week. I had advertised it here but didn't make much progress.

Lesson learnt, wazua is full of arm-chair analysts while deals are being made everyday out there.

If everyone was to start analysing property decisions the way you do, what do you think would happen to our holdings in HF, Equity and KCB ?

Luckily for us, buying decisions are 80% emotions and 20% logic. We are still in business.

Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly

Pole @FRM2011. I had forgotten our deal kidogo! He he he.
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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FRM2011
#22 Posted : Thursday, September 25, 2014 9:46:48 AM
Rank: Elder


Joined: 11/5/2010
Posts: 2,459
MaichBlack wrote:
FRM2011 wrote:
MaichBlack wrote:
Why buy a house and make 5% ROI???

If you dream is to eventually own a house in that area, simply buy a plot in the same neighbourhood and put the rest of the money in a better yielding investment. For crying out loud, even a bank will give you double that ROI on fixed deposit account!!! And there are much more lucrative investments than fixed deposit any how!


Weeee Maich mweusi, I thought we had a deal you stop kuharibu soko in the other thread.

The house was sold by a broker who made a cool 350k in less than a week. I had advertised it here but didn't make much progress.

Lesson learnt, wazua is full of arm-chair analysts while deals are being made everyday out there.

If everyone was to start analysing property decisions the way you do, what do you think would happen to our holdings in HF, Equity and KCB ?

Luckily for us, buying decisions are 80% emotions and 20% logic. We are still in business.

Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly Laughing out loudly

Pole @FRM2011. I had forgotten our deal kidogo! He he he.


Thanks bro, let the cash tills continue ringing.
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Horton
#23 Posted : Thursday, September 25, 2014 12:49:55 PM
Rank: Veteran


Joined: 8/30/2007
Posts: 1,558
Location: Nairobi
MaichBlack wrote:
FRM2011 wrote:
Pablo wrote:
Thats a horible deal.

Someone invests, 7.5M and gets 35k rent. An ROI is 5%, Aiiii

If you get a 12% morgage to buy that house payable in 15 years the repayment is almost 90k per month.


@Pablo, that's Kenyan real estate for you. Consider this;

1. South B cost-16m rent 50k roi-3.7%
2. Lavington cost-20m rent 100k roi - 6%
3. Mombasa road cost-10m rent 40k roi- 4.8%
4. Ngummo cost-14m rent-45k roi 3.8%.

That's what's wrong with the Kenya real estate industry. Buyers being shafted right left and center. And this is for cash buyers. Fact in mortgage and you have negative ROI. Like for the south B house above, you ROI will be approximately -8%. Yes, NEGATIVE EIGHT PERCENT. You have to be high on wet bhang soaked in petrol to even consider some things!!!

For me, real estate investment is a no brainer. NO MORTGAGE, NO BUYING!!! Raise money and build! Then you can make money.

At the very least, developers sell house at double the total cost put in. Then mortgage will at least triple that value! 6 times a slave. 30 years a slave.




i see u quote bhangi very frequentlyLaughing out loudly
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Pablo
#24 Posted : Thursday, September 25, 2014 3:40:46 PM
Rank: Member


Joined: 3/17/2008
Posts: 567
Location: Nairobi
@ horton & Mkwasi
Capital gains has not been taken into consideration because whether you do a real estate purchase with an ROI of 2% or of 10% the capital gains are a common denominator and hence cancell out. Both the South b house and the units built will have capital gains even tho not at the same rate.

I am now agreeing with @MaichBlack if u have cash, buying a built/ready property is sometimes a waste of time unless in the special circumstances where ROI permits.
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Gordon Gekko
#25 Posted : Friday, September 26, 2014 3:59:44 AM
Rank: Elder


Joined: 5/27/2008
Posts: 3,760
Horton wrote:
Gordon Gekko wrote:
Pablo wrote:
Thats a horible deal.

Someone invests, 7.5M and gets 35k rent. An ROI is 5%, Aiiii

If you get a 12% morgage to buy that house payable in 15 years the repayment is almost 90k per month.

Show me any real estate worth 7.5m that can fetch a rent of 35k.



Nyayo estate embakasi

Apartments are 7.2m rent 30k. Maisonettes are 9.5m rent 40k.
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target1360
#26 Posted : Friday, September 26, 2014 5:45:13 AM
Rank: Member


Joined: 5/14/2014
Posts: 288
Location: nairobi
MaichBlack wrote:
sparkly wrote:
Owner sounds very attached. Will he and mama watoto agree to be evicted if they default ama it will be drama.

Or worse, you find out the house is still his. You were played big time!!! Or he sells it again. And again. And again. And again....

This is Kenya!!! Remember???


being in kenya i would evict the guy,theres a high risk of the him re selling the house to many other people.Thisiskenya
I find satisfaction in owning great business,not trading them
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