hi wazuas,i am in need of ur advice.i have 1.5m from a bank that is charging 18% on interest.My question is,should i buy a piece of prime land somewhere or should i invest it on rental house within my plot with a return of 20k per month?
I will highly appreciate your advices

It depends with the dynamics of the area, if the plot is located in either Nairobi, Kisumu or Mombasa, i would suggest you buy another plot for speculation. this is because the appreciation of land values is such areas in high. But kama uko Meru, Embu, Lodwar.......just build the house

Whats 1.5M kijana? prime plot? construct? rental houses? Wacha mchezo!

Dont discourage the guy......depending with the nature of real estate establishment that he wants, he could reap good. For instance rental rooms in colleges and universities located in semi-urban areas, am sure fetches well.

So if you bought the rental, your yield is 16% vs the interest rate of 18%. To be honest that is a very healthy yield from rental if your figures are correct currently nairobi is yielding 4-8%. Kindly confirm the rental you are buying is going for 1.5m and you will get a net rent of 20k? How easy or hard is it to rent out? Service charge etc? If so, I would definitely get the rental and try and pay off the loan with the rent and top it off with my own sources. This is also ignoring the price growth as thats not assured. Also rent is usually escalated evey year or so, depending on a number of factors. However, you need to add closing costs to your budget if you do settle for any real estate.

I personally don't like land as it is too speculative and there is no monthly returns so you would get stuck fending the loan on your own.

If I were you, I would also start doing some serious reading/research to understand what market you are getting into before you dive in.