(hope you get this time Heri)
Objective: Build 15m worth of rental houses.
Masembe Borrowed 15m
Githendu Spent own 15m

Masembe’s cost and returns
Cost vs Return
Cashflow Month 1 180k 140k
Month 2 180k 140k


Githendu’s cost and returns
Cost vs Return
Cashflow Month 1 15m 140k
Month 2 15m 140k

I.e. cashflow-wise, you are so worse off spending your own cash to invest

How funny most RE bashers are probably holding HFCK shares firmly. Talk of Nestle and Cadbury bashing Cocoa farmers. Or Michael Joseph talking of Kenyans peculiar calling habits!

Interesting conversation.

But me thinks we are missing something. In Kenya investing in real estate is not just a question of costs and returns.

In a society like ours, with no social safety net to speak of, real estate is about security and peace of mind. This applies even when the mjengo is done with an eye on rental income. It is not without good reason that many people will call their construction project 'my pension plan.'

When you factor in such intangible considerations a pure calculation of return on investment (for a product that many Kenyans will never sell anyway) is likely to lead you to the wrong conclusions.

Plus real estate investment in Kenya is a fantastically lucrative business, even by World standards. If you don't believe me, ask one Mukesh Ambani.

@Rongla - Warren Buffet is the biggest philanthropists in the World!!! 99% of his wealth will go to charity during his lifetime or death. He has already given tonne loads!!!

Some of the charities deal with vices which include smoking! But guess what. Warren Buffet through Berkshire Hathaway owns stock in companies that deal with cigarettes in one way or the other.

As long as people are willing to work for banks (repaying loans), we will own banking stock! Sisi sio mama ya mtu hapa!! Biachara ni Biachara.

I don't think the owner of Lee Funeral wishes death on anyone. But there was a market gap that has made him a very wealthy man. People will die no matter what he does or wishes! And when they do, he gets paid!

Capitalism 101.

How many people accumilate wealth without borrowing. My friend borrowed 25m from member added his own 5m 2007 and bought a 1/2 Acre in upperhil. I thought he was mad he lost weight repaying the morgage in 2011 his home was almost seized he was given a restructured payment. By 2013 brokers were hunting for him he was cornered and offered 175m. Today he is a landbroker in Kajiado unless otherwise he will never know poverty. Assume he tried to save his 225k repayment from 2007 h8ow much worth of land would he get in upperhill

@MaichBlack Thank you for the informative links. One thing I have noted from Warren Buffett excerpts is that he isn't bashing nor talking down other investors who have chosen a different investment vehicle. He isn't saying " look, I am riding on your backs" and as you've put it, he is a philanthropist and will give away 99% of his wealth and this is how he is taking the social responsibility I was talking about.
I am in no way suggesting you give away any of your wealth or be a philanthropist or not to invest in any company for that matter, But as I said, for us to develop as a country we shouldn't tie our investments approach to super profits, mega profits and nothing else but profits
YES, both of you are 101% capitalist, But there is only one Warren Buffett and can only be one at a time. If there was room for another WB of his generation, we wouldn't talking about him as he wouldn't have been that wealthy anyway.