Wazua
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Real Estate in Kenya
Rank: Hello Joined: 6/25/2018 Posts: 3 Location: Nairobi
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Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think?
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Rank: Elder Joined: 1/8/2018 Posts: 2,211 Location: DC (Dustbowl County)
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Show me a sensible fellow who has not made a pile investing long term in real estate in Kenya from as far back as 1963 and I will show you a fire engine red flying horse in Pluto. And let nobody counter with even a single article written by Lukorito Jones.
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Rank: New-farer Joined: 2/8/2018 Posts: 73
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Read the below report as it will give you an accurate picture of the sector. https://stanlibfahariire...T-Annual-Report-2017.pdf
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Rank: Member Joined: 5/2/2018 Posts: 267
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What type/kind of an investment in real estate? Is it rental income-generating commercial or residential property/ies? Or are you intending to buy land and hold to sell in future? And which market segment are you interested in or focused on? BTW, buying Stanlib Fahari I-Reit is another way of investing in real estate....
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Rank: Elder Joined: 1/8/2018 Posts: 2,211 Location: DC (Dustbowl County)
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I would NOT recommend investing in an REIT at all. Investing in an REIT is like paying a bank a monthly commission to invest for you. Why pay the middleman's overhead and salaries when you can buy directly? Be wise.
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Rank: Member Joined: 5/2/2018 Posts: 267
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MugundaMan wrote:I would NOT recommend investing in an REIT at all. Investing in an REIT is like paying a bank a monthly commission to invest for you. Why pay the middleman's overhead and salaries when you can buy directly? Be wise. Well, it would depend on how much capital one has. If you need some 'parking' that must be real estate-oriented, then an I-Reit would do as you seek a 'permanent' home. If you have significant capital, then you have broader options.
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Rank: Veteran Joined: 7/3/2007 Posts: 1,634
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MugundaMan wrote:Show me a sensible fellow who has not made a pile investing long term in real estate in Kenya from as far back as 1963 and I will show you a fire engine red flying horse in Pluto. And let nobody counter with even a single article written by Lukorito Jones. This is very true. On three different occasions I have sunk money into real estate at a time when everybody told me I was being foolish. In each case I have more than trebled my money over ten years, at a minimum. In one of the cases I actually multiplied my investment by about 30. Granted this is exceptional but it is not pure luck. I know a few people who have done the same or better. Don't listen to doom sayers who keep preaching about a sector bust that has never happened. Even when it does, the pullback is still much less than for other investments. "The opposite of a correct statement is a false statement. But the opposite of a profound truth may well be another profound truth." (Niels Bohr)
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Rank: User Joined: 8/15/2013 Posts: 13,237 Location: Vacuum
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I think real estate is good for guys with cash and not loans. When I say real estate, I mean buying and building houses and not buying land to speculate If Obiero did it, Who Am I?
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Rank: Member Joined: 1/30/2011 Posts: 207
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Swenani wrote:I think real estate is good for guys with cash and not loans.
When I say real estate, I mean buying and building houses and not buying land to speculate Very true... The loan (interest) aspect is usually tricky at times especially when it comes to prime land/property purchases etc - but unfortunately majority of Kenyans considerably ignore to cost factor the interest charged - when citing the purchase real price/cost of the land or/and property...
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Rank: Veteran Joined: 11/13/2015 Posts: 1,590
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Wakanyugi wrote:MugundaMan wrote:Show me a sensible fellow who has not made a pile investing long term in real estate in Kenya from as far back as 1963 and I will show you a fire engine red flying horse in Pluto. And let nobody counter with even a single article written by Lukorito Jones. This is very true. On three different occasions I have sunk money into real estate at a time when everybody told me I was being foolish. In each case I have more than trebled my money over ten years, at a minimum. In one of the cases I actually multiplied my investment by about 30. Granted this is exceptional but it is not pure luck. I know a few people who have done the same or better. Don't listen to doom sayers who keep preaching about a sector bust that has never happened. Even when it does, the pullback is still much less than for other investments. Now I understand why you are insisting on the interest rate caps. Feudalism feels good.
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Rank: Veteran Joined: 11/13/2015 Posts: 1,590
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Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in kenya is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains. The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized.
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Rank: Veteran Joined: 7/3/2007 Posts: 1,634
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wukan wrote:Wakanyugi wrote:MugundaMan wrote:Show me a sensible fellow who has not made a pile investing long term in real estate in Kenya from as far back as 1963 and I will show you a fire engine red flying horse in Pluto. And let nobody counter with even a single article written by Lukorito Jones. This is very true. On three different occasions I have sunk money into real estate at a time when everybody told me I was being foolish. In each case I have more than trebled my money over ten years, at a minimum. In one of the cases I actually multiplied my investment by about 30. Granted this is exceptional but it is not pure luck. I know a few people who have done the same or better. Don't listen to doom sayers who keep preaching about a sector bust that has never happened. Even when it does, the pullback is still much less than for other investments. Now I understand why you are insisting on the interest rate caps. Feudalism feels good. No you don't. Careful about that Kiwaru. "The opposite of a correct statement is a false statement. But the opposite of a profound truth may well be another profound truth." (Niels Bohr)
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Rank: Veteran Joined: 7/3/2007 Posts: 1,634
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wukan wrote:Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in kenya is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains.
The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized. Thus speaks the armchair investor. The typical spiel is to criticse but offer no alternatives. I have lost count of the number of times I have made money by reading such so called advise on Wazua and doing the exact opposite. "The opposite of a correct statement is a false statement. But the opposite of a profound truth may well be another profound truth." (Niels Bohr)
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Rank: User Joined: 8/15/2013 Posts: 13,237 Location: Vacuum
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wukan wrote:Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in Nairobi is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains. The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized. There are good opportunities in Mashinani for real estate If Obiero did it, Who Am I?
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Rank: Hello Joined: 6/25/2018 Posts: 3 Location: Nairobi
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MugundaMan wrote:Show me a sensible fellow who has not made a pile investing long term in real estate in Kenya from as far back as 1963 and I will show you a fire engine red flying horse in Pluto. And let nobody counter with even a single article written by Lukorito Jones.  exactly why I want to invest. It is stable and almost a guaranteed good returns in the long term.
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Rank: Veteran Joined: 11/13/2015 Posts: 1,590
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Wakanyugi wrote:wukan wrote:Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in kenya is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains.
The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized. Thus speaks the armchair investor. The typical spiel is to criticse but offer no alternatives. I have lost count of the number of times I have made money by reading such so called advise on Wazua and doing the exact opposite. Maybe I'm an armchair investor in real estate after witnessing relatives reduced to paupers chasing the real estate dream. Lucky I got to travel the world to realize there is much wealth creation selling goods n services.
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Rank: Veteran Joined: 11/13/2015 Posts: 1,590
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Swenani wrote:wukan wrote:Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in Nairobi is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains. The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized. There are good opportunities in Mashinani for real estate mashinani  can't even spend the night there without being visited.
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Rank: New-farer Joined: 8/23/2015 Posts: 64 Location: nairobi
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wukan wrote:Wakanyugi wrote:wukan wrote:Superwoman910 wrote:Hi Wazuans,
I am thinking of investing in the real estate sector. The thing is that there is a lot of mix up from reports about its current status, i.e., whether the returns are good and worth it, or not.
What do you guys think? Real estate in kenya is the accumulation of dead assets in the hope it will serve you at a later date. You will rarely get to unlock its full potential in your lifetime(maybe your kids will). It is capital intensive and the returns are only marginally higher than inflation. 5-7% rental yield maybe 5% capital gains.
The upkeep of real estate is also expensive. The lack of planning and development control also means you may end up in a slum like neighborhood or a place that resembles a prison/concentration camp(barbed wire, guards and dogs). The current status looks like the tail end of a boom cycle most landlords are not getting the asking rent, lots of vacancies in retail and commercial space and defaulting tenants. However Kenyan real estate has lots of potential most of the land is under-developed and underutilized. Thus speaks the armchair investor. The typical spiel is to criticse but offer no alternatives. I have lost count of the number of times I have made money by reading such so called advise on Wazua and doing the exact opposite. Maybe I'm an armchair investor in real estate after witnessing relatives reduced to paupers chasing the real estate dream. Lucky I got to travel the world to realize there is much wealth creation selling goods n services. Real estate holds so much capital that can be applied in industry. a plot of land for the sake of it is a waste of cash if you have an income generating activity.
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Rank: Hello Joined: 6/25/2018 Posts: 3 Location: Nairobi
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Superprime1 wrote:What type/kind of an investment in real estate? Is it rental income-generating commercial or residential property/ies? Or are you intending to buy land and hold to sell in future? And which market segment are you interested in or focused on? BTW, buying Stanlib Fahari I-Reit is another way of investing in real estate.... I think rental (residential) is the best way to go. Cytonn has some pretty good looking properties that are also affordable (in Ridgeways and Ruaka). Just want to make sure it is the absolute best decision before investing with them
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Rank: Elder Joined: 1/8/2018 Posts: 2,211 Location: DC (Dustbowl County)
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Wakanyugi wrote:
Thus speaks the armchair investor. The typical spiel is to criticse but offer no alternatives. I have lost count of the number of times I have made money by reading such so called advise on Wazua and doing the exact opposite.
Too funny and yet so true, brother! I was one of those who started out a long time ago listening to what I thought was very convincing spiel of "armchair investors" who chided me with harsh tones and waggy fingers about the perils of investing in real estate in Kenya. But when I saw my risk-taker peers minting big time from very modest investments in far flung areas held over time, I got religion fast! No other investment in this here Kenia comes close to matching the stability, safety and consistency of real estate of any form well bought and held over the long term, whether developed or not.
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