Tips to start, grow your real estate investments
Stakeholders in housing and real estate are expected to meet in Nairobi between May 12 and 14 to foster solutions that seek to promote low-cost and affordable housing as a driver of economic growth in Africa.
What you need to know:
Investing in real estate as a beginner does not have to be troublesome, talk to experienced real estate companies. There are key steps you need to follow when investing
Investing in property does not need to be one of the most expensive purchases that you will ever make. But the good thing is you do not need millions to own property. Here are practical was to grow your real estate portfolio.
Start with savings
Even if you are not sure where to invest, start by having savings with an end goal of owning property. You can open a savings account and put aside as low as Shs 50,000. With consistency and discipline, you will accumulate some amount that you can kick-start investing with.
Join a Sacco
You may opt to open a Sacco and deposit savings every month. At the end of the year, you earn dividends from savings and shares. One main advantage of a Sacco is that you can borrow up to three or four times what you have saved. This is an easy way of investing in property without straining.
Focus on potential in an area
With time, land appreciates in value. As an investor, you can focus on an area with potential for growth because the prices are affordable in comparison to an area that has developments.
Identify the seller
After identifying the area, you would like to invest, look out for the property developers selling properties there. You can visit their offices, attend the property site visits. Further, you can conduct a title deed search to know who the owner of the property is. It is advisable as a real estate investment beginner to invest with a real estate company as they will help you with all due diligence, documentation and subdivision of land.
Know all the costs involved
It is important to identify all costs involved during and after the purchase process. This will help you prepare the required finances for your investment and avoid impromptu financing. At times there may be hidden costs on land that can affect you. When you know all the costs involved, you will decide whether your savings will be sufficient and you will need to take a loan.
There are key steps you need to follow when buying any real estate product. As a beginner avoid taking short cuts and making assumptions on some critical information that can impact your investment. Ensure you get all the information and sign all land buying documents.
Protect yourself
Make sure you are conversant with all documents involved in property ownership. Do ensure you obtain all receipts of payments and sign all the documents and retain a copy of the same for your records both now and in future.
In the long run, it is efficient with a genuine land selling company, a registered lawyer, valuer and surveyor. As professionals, they are able to protect you and your interests when investing. Unfortunately, people try and run away from professionals and end up losing a lot more.
Think and invest long term
Real estate is a long term asset and it is advisable to think long term when considering this type of investment. Example, if you invest in land in a fast-growing area, in five years’ time it will be worth much more. This is because land appreciates over a period of time.
Be realistic in your investment expectations
As with any investment, property investment may not bring returns immediately. Therefore, do not over expect returns in the short term, rather be realistic with returns. Investing in real estate as a beginner does not have to be troublesome, talk to experienced real estate companies for guidance and advice.
Identify the kind of real estate investment you wish to invest in
Real estate investment is in two main categories; residential and commercial. Further, it is subdivided into leasehold and freehold. Identify the kind of property you would wish to invest in and for what purpose.
Residential property – this is exclusively used for private living for a family or an individual
Commercial property – this is for purposes of business activities.
Leasehold property – where you only hold the land for a certain period subject to frequent payments. The longest you can own the property is 99 years
Freehold property – where you have absolute ownership of the property and land on which it stands. This ownership does not need to be renewed.
Categories
Real estate investment is in two main categories; residential and commercial. Further, it is subdivided into leasehold and freehold. Identify the kind of property you would wish to invest in and for what purpose.
Residential property – this is exclusively used for private living for a family or an individual
Commercial property – this is for purposes of business activities.
Leasehold property – where you only hold the land for a certain period subject to frequent payments. The longest you can own the property is 99 years
Freehold property – where you have absolute ownership of the property and land on which it stands. This ownership does not need to be renewed.
