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10-12M mortgage
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enyands
#41 Posted : Saturday, May 14, 2016 3:19:01 PM
Rank: Elder

Joined: 12/25/2014
Posts: 2,301
Location: kenya
obiero wrote:
heri wrote:
Obi 1 Kanobi wrote:
Its a no brainer, take the mortgage quick quick.

The test is simple, its a good deal as long as the interest component of the monthly payments are lower than the rental incomes. Principal component is an investment.


@Obi, i have never looked at it this way. I always check if the rent income will cover both the loan interest and the principal repayment.

Even at an interest rate of 6% the rental income will not cover principal plus interest
.



Mark you there are some rental houses that have been empty and takes awhile to fill it up. If you take a loan for such and investments and is not filled up, then be ready to take HB pressure medications.
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Thitifini
#42 Posted : Monday, May 16, 2016 12:07:00 AM
Rank: Member

Joined: 1/15/2015
Posts: 681
Location: Kenya
N.B. 1)You can get the loan to build as long as it's residential house and you have the title to land you are to build on.
2) you can change jobs in between repayments periods as long as you can secure non-paid leave for "capacity building" (easy if in good relationship with chief executive).

I am taking the loan. Building on a 1/4 which I own. Calculations: am paying rent 38k pm, if I take 6M loan I repay 34k pm on the loan+interest, which will be less than the current rent after completion in 6months (say Jan 2017). I'm at preliminary stages of application.

My plan, I was to construct anyway from some assignments I'm consulting. If I get the loan then I get the income from the consultancies to expand my biz.

In case the loan terms don't look good in say a years time, then I have the biz buy out the motgage in cash (it can afford to at current). I will have got some income either way from appreciation and profit from the freed-up cash.

60% Learning, 30% synthesizing, 10% Debating
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UpcomingPaperChaser
#43 Posted : Monday, May 16, 2016 5:18:05 AM
Rank: Member

Joined: 1/20/2015
Posts: 489
Location: Nairobi
Thitifini wrote:
N.B. 1)You can get the loan to build as long as it's residential house and you have the title to land you are to build on.
2) you can change jobs in between repayments periods as long as you can secure non-paid leave for "capacity building" (easy if in good relationship with chief executive).

I am taking the loan. Building on a 1/4 which I own. Calculations: am paying rent 38k pm, if I take 6M loan I repay 34k pm on the loan+interest, which will be less than the current rent after completion in 6months (say Jan 2017). I'm at preliminary stages of application.

My plan, I was to construct anyway from some assignments I'm consulting. If I get the loan then I get the income from the consultancies to expand my biz.

In case the loan terms don't look good in say a years time, then I have the biz buy out the motgage in cash (it can afford to at current). I will have got some income either way from appreciation and profit from the freed-up cash.


Your rent is twice Swenani's salary..........
Enjoy every moment of your life, you never know when your time will come.
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Swenani
#44 Posted : Monday, May 16, 2016 12:48:02 PM
Rank: User

Joined: 8/15/2013
Posts: 13,237
Location: Vacuum
UpcomingPaperChaser wrote:
Thitifini wrote:
N.B. 1)You can get the loan to build as long as it's residential house and you have the title to land you are to build on.
2) you can change jobs in between repayments periods as long as you can secure non-paid leave for "capacity building" (easy if in good relationship with chief executive).

I am taking the loan. Building on a 1/4 which I own. Calculations: am paying rent 38k pm, if I take 6M loan I repay 34k pm on the loan+interest, which will be less than the current rent after completion in 6months (say Jan 2017). I'm at preliminary stages of application.

My plan, I was to construct anyway from some assignments I'm consulting. If I get the loan then I get the income from the consultancies to expand my biz.

In case the loan terms don't look good in say a years time, then I have the biz buy out the motgage in cash (it can afford to at current). I will have got some income either way from appreciation and profit from the freed-up cash.


Your rent is twice Swenani's salary..........


Life is not fairSad Sad Sad Sad
If Obiero did it, Who Am I?
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Othelo
#45 Posted : Monday, May 16, 2016 1:18:59 PM
Rank: User

Joined: 1/20/2014
Posts: 3,528
Swenani wrote:
UpcomingPaperChaser wrote:
Thitifini wrote:
N.B. 1)You can get the loan to build as long as it's residential house and you have the title to land you are to build on.
2) you can change jobs in between repayments periods as long as you can secure non-paid leave for "capacity building" (easy if in good relationship with chief executive).

I am taking the loan. Building on a 1/4 which I own. Calculations: am paying rent 38k pm, if I take 6M loan I repay 34k pm on the loan+interest, which will be less than the current rent after completion in 6months (say Jan 2017). I'm at preliminary stages of application.

My plan, I was to construct anyway from some assignments I'm consulting. If I get the loan then I get the income from the consultancies to expand my biz.

In case the loan terms don't look good in say a years time, then I have the biz buy out the mortgage in cash (it can afford to at current). I will have got some income either way from appreciation and profit from the freed-up cash.


Your rent is twice Swenani's salary..........


Life is not fairSad Sad Sad Sad

While he enjoys more bread and fish in Wazua than the rest smile
Formal education will make you a living. Self-education will make you a fortune - Jim Rohn.
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UpcomingPaperChaser
#46 Posted : Monday, May 16, 2016 11:24:32 PM
Rank: Member

Joined: 1/20/2015
Posts: 489
Location: Nairobi
Othelo wrote:
Swenani wrote:
UpcomingPaperChaser wrote:
Thitifini wrote:
N.B. 1)You can get the loan to build as long as it's residential house and you have the title to land you are to build on.
2) you can change jobs in between repayments periods as long as you can secure non-paid leave for "capacity building" (easy if in good relationship with chief executive).

I am taking the loan. Building on a 1/4 which I own. Calculations: am paying rent 38k pm, if I take 6M loan I repay 34k pm on the loan+interest, which will be less than the current rent after completion in 6months (say Jan 2017). I'm at preliminary stages of application.

My plan, I was to construct anyway from some assignments I'm consulting. If I get the loan then I get the income from the consultancies to expand my biz.

In case the loan terms don't look good in say a years time, then I have the biz buy out the mortgage in cash (it can afford to at current). I will have got some income either way from appreciation and profit from the freed-up cash.


Your rent is twice Swenani's salary..........


Life is not fairSad Sad Sad Sad

While he enjoys more bread and fish in Wazua than the rest smile


hahahaa.......vybe master, his baits have an accuracy of 99.99%
Enjoy every moment of your life, you never know when your time will come.
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tnai9
#47 Posted : Monday, June 20, 2016 2:25:25 PM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Been house shopping a lot for my mortgage house and even went to the counties armed with advice from wazua. I come from the western part of the country and found a 4br bungalow in Eldy Kimumu-(Eldoret-Iten road) on a near quarter plot of land that is like 60m from the tarmac(agreed 7M with the owner)
The house is rented- 26k pm and there is big room for expansion both in front and behind(guy built the house at the center of the plot)
Rental returns are 12-13k for a 2br and 7-8k for 1 br. Fundis told me if I push in another 5m, rental income would easily go to almost 100k p.m.(6-2br)
For eldy, these returns are fairly good, and am may not be able to get such a deal elsewhere considering many factors.
But now to the elephant in the deal -- my people and my friends..a number of them are strongly discouraging me..that since am not a local and with our poisoned politics..its not a wise investment. Some history supports this argument and I had also thought about it in some way..

Its a slippery/controversial issue but objective advice is welcome.
I don't intend to stay in the house(s)
"The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence." ― Charles Bukowski
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streetwise
#48 Posted : Monday, June 20, 2016 4:28:29 PM
Rank: Veteran

Joined: 6/23/2011
Posts: 1,740
Location: Nairobi
Nothing wrong about the location but one advise I will give you, It does not matter how much you will get from a nice looking investment venture, key understand the cost.

Remember a business makes losses when the cost is greater than the revenue
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tnai9
#49 Posted : Monday, June 20, 2016 5:04:08 PM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
streetwise wrote:
Nothing wrong about the location but one advise I will give you, It does not matter how much you will get from a nice looking investment venture, key understand the cost.

Remember a business makes losses when the cost is greater than the revenue


hmmm...d'oh! d'oh!

philosophical....
"The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence." ― Charles Bukowski
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tnai9
#50 Posted : Monday, June 27, 2016 8:19:31 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Wazuans am considering the following options:
1 - Flat on mbagathi way-9.5M - rental return 50-55k
Advantages - Location, rental growth(will level off at sm point), can stay in it since am based in Nairobi
Disadvantages - apartment(inflexibility)

2 - Maisonette in Buru with an extension 9.3M - Total rental income 50k, main 35, ext 15k
Advantages - own title, can modify, can rent out the extension and stay in main, Cant miss tenant in case of renting
Disadvantages - hse within eastlands - slow rental growth, eastlands challenges--Outer ring completion may solve some

3 - Hse in a County HQ(main house + 2SQs) - 7.5M Rental income 50K
Advantages - Higher ROI that Nairobi, Own title, Can clear the mortgage faster and move onto something else.
Disadvantages - Will have to be a tenant now that am based in Nairobi..

4. House in county HQ with room for expansion - 7M , rental return 26K
Advantages - There is big room for expansion and growing the rent,House so close to the road, own title
Disadvantages - Capital for expansion not available immediately,

which option do wazuans lean towards?
"The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence." ― Charles Bukowski
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