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10-12M mortgage
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tnai9
#1 Posted : Monday, April 18, 2016 8:44:59 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Wazuans, I intend to take this quoted range of mortgage in the next three months(am a civil servant, early thirties) and am torn between a number of options. I request wazuans for their candid opinions on my thoughts.
1. Buy a nice three bedroom apartment in south B/Imara/Nairobi West/langata and rent. Target rent 50K pm.

2. Buy a 2br apartment in Kilimani/Kileleshwa or equivalents then replace some Chinese fittings at about 400K, furnish it at 700K then rent out at 80-100K(is it viable, are there tenants?)(Also don't have the extra 1.2M for repairs immediately)

3. Buy a house in Buru for 8-9M and stay in it with my family. - This option frees my payslip a bit, I can afford small other loans for biashara. Currently renting(30K PM)
"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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Jon Jones
#2 Posted : Monday, April 18, 2016 9:52:39 AM
Rank: Member

Joined: 9/11/2015
Posts: 245
Location: Thika
tnai9 wrote:
Wazuans, I intend to take this quoted range of mortgage in the next three months(am a civil servant, early thirties) and am torn between a number of options. I request wazuans for their candid opinions on my thoughts.
1. Buy a nice three bedroom apartment in south B/Imara/Nairobi West/langata and rent. Target rent 50K pm.

2. Buy a 2br apartment in Kilimani/Kileleshwa or equivalents then replace some Chinese fittings at about 400K, furnish it at 700K then rent out at 80-100K(is it viable, are there tenants?)(Also don't have the extra 1.2M for repairs immediately)

3. Buy a house in Buru for 8-9M and stay in it with my family. - This option frees my payslip a bit, I can afford small other loans for biashara. Currently renting(30K PM)

Walk away from a mortgage if you can. Check this link: http://www.milliardaire....e/mortgage-will-enslave/
Since men have learned to shoot without missing, I have learned to fly without perching
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tnai9
#3 Posted : Monday, April 18, 2016 9:56:09 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Jon Jones wrote:

Walk away from a mortgage if you can. Check this link: http://www.milliardaire..../mortgage-will-enslave/


Thanks Jones. But I have access to a mortgage at 3% p.a. I believe there is no better rate anywhere in the republic. Reason I would like to take it. Plus I can get upto 100% financing, just need proper documents
"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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jerry
#4 Posted : Monday, April 18, 2016 10:05:55 AM
Rank: Elder

Joined: 9/29/2006
Posts: 2,570
tnai9 wrote:
Jon Jones wrote:

Walk away from a mortgage if you can. Check this link: http://www.milliardaire..../mortgage-will-enslave/


Thanks Jones. But I have access to a mortgage at 3% p.a. I believe there is no better rate anywhere in the republic. Reason I would like to take it. Plus I can get upto 100% financing, just need proper documents

Are you getting mortgage bacause you are in GoK? If you ever moved to private sector, will the mortgage be affected? Compare what you'll spend on mortgage per month and possible rent that you can get from the house.
The opposite of courage is not cowardice, it's conformity.
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Jon Jones
#5 Posted : Monday, April 18, 2016 10:06:15 AM
Rank: Member

Joined: 9/11/2015
Posts: 245
Location: Thika
tnai9 wrote:
Jon Jones wrote:

Walk away from a mortgage if you can. Check this link: http://www.milliardaire..../mortgage-will-enslave/


Thanks Jones. But I have access to a mortgage at 3% p.a. I believe there is no better rate anywhere in the republic. Reason I would like to take it. Plus I can get upto 100% financing, just need proper documents

If its possible to get the cash 12 million, buy an eighth in a satellite town like Ruiru...build bedsitters and you will be smiling all the way to the bank.
Since men have learned to shoot without missing, I have learned to fly without perching
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tnai9
#6 Posted : Monday, April 18, 2016 10:10:09 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Jon Jones wrote:

If its possible to get the cash 12 million, buy an eighth in a satellite town like Ruiru...build bedsitters and you will be smiling all the way to the bank.


Other conditions I have
1. Only one mortgage allowed at a time.
2. Can only buy a residential house, fully built(no off plans), no commercials
"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
#7 Posted : Monday, April 18, 2016 10:16:04 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
jerry wrote:

Are you getting mortgage bacause you are in GoK? If you ever moved to private sector, will the mortgage be affected? Compare what you'll spend on mortgage per month and possible rent that you can get from the house.


I have considered this, and I'll only move if the new employer gives me an increment that will cover the increased interest. I also have an allowance of up to 1yr within which to sell the house and pay off. I also realize i will be forced to be very choosy with employers
"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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TheGeek
#8 Posted : Monday, April 18, 2016 10:27:19 AM
Rank: Member

Joined: 7/3/2014
Posts: 245
tnai9 wrote:
jerry wrote:

Are you getting mortgage bacause you are in GoK? If you ever moved to private sector, will the mortgage be affected? Compare what you'll spend on mortgage per month and possible rent that you can get from the house.


I have considered this, and I'll only move if the new employer gives me an increment that will cover the increased interest. I also have an allowance of up to 1yr within which to sell the house and pay off. I also realize i will be forced to be very choosy with employers



This will be a yoke. You better off renting then saving and investing.
In the world of securities, courage and patience become the supreme virtues after adequate knowledge and a tested judgment are at hand.
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Shak
#9 Posted : Monday, April 18, 2016 11:28:59 AM
Rank: Elder

Joined: 2/22/2009
Posts: 2,449
Location: Africa
Jon Jones wrote:
[quote=tnai9]Wazuans, I intend to take this quoted range of mortgage in the next three months(am a civil servant, early thirties) and am torn between a number of options. I request wazuans for their candid opinions on my thoughts.
1. Buy a nice three bedroom apartment in south B/Imara/Nairobi West/langata and rent. Target rent 50K pm.

2. Buy a 2br apartment in Kilimani/Kileleshwa or equivalents then replace some Chinese fittings at about 400K, furnish it at 700K then rent out at 80-100K(is it viable, are there tenants?)(Also don't have the extra 1.2M for repairs immediately)

3. Buy a house in Buru for 8-9M and stay in it with my family. - This option frees my payslip a bit, I can afford small other loans for biashara. Currently renting(30K PM)

Walk away from a mortgage if you can. Check this link: http://www.milliardaire..../mortgage-will-enslave/[/quote]

If you take a 10million shilling mortgage for 18 years you'll be repaying around 60k per month so option 1 would not make economic sense. A 7-8 million shilling rental property would make more sense.Also look into the possibility of making accelerated repayments so that you're not tied to the full 18 years
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tnai9
#10 Posted : Monday, April 18, 2016 11:43:22 AM
Rank: Member

Joined: 6/21/2010
Posts: 345
Location: easto
Shak wrote:


If you take a 10million shilling mortgage for 18 years you'll be repaying around 60k per month so option 1 would not make economic sense. A 7-8 million shilling rental property would make more sense.Also look into the possibility of making accelerated repayments so that you're not tied to the full 18 years


I was looking at it this way, that if am paying for example 70K pm for fifteen years, and renting at 50k, effectively am just topping up the rental income with 20k,so my net salo is just less 20k(off course have to provide for defaults etc). This allows me to take and service say another sacco loan. I expect, over the fifteen years, rent to increase and at some point it may pay the mortgage.
The Sacco loans will be for starting projects/biasharas to assist in accelerating the mortgage.
"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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