The folly of investing in Rental Units

[kawambui]

@Fala 12

ninatafuta plot mahali around nairobi max 400k

define around nairobi…

[Acoustic]

@kawambui

hehehe…
which form of robbery do you support

Hehee … none my broda.

[kawambui]

@Acoustic

Hehee … none my broda.

i support all forms of legal robberies

[Yollo]

@Mr Black

My thoughts exactly, our production capacity is vast but this land frenzy takes all the attention, for instance we are importing sugar when we can manufacture our own cheaply hapa Tana river, we always somehow have a maize deficit, milk and dairy products pia. We import eggs from UG now and animal feeds raw materials from TZ, we bring in apples and oranges from SA and Egypt, our apparel industry imports cotton when we can produce our own, mchele tunakula huku most of it (the ones that cost less than a hundred) comes from akina Pakistan and the likes…and the list goes on. Its fuckin pathetic.

We are not producing globally competitive products and cost of production in Kenya coupled with many taxes is what is killing manufacturing

[Yollo]

@Acoustic

It’s crazy, this land speculation. Why should someone make 300% profit in 5 years for doing absolutely nothing? I refuse to participate in this form of robbery.

Demand and supply forces

[Fala_12]

@kawambui

define around nairobi…

any where along thika superhighway and sorroundings. na kangundo road pia.
machakos nikipata pia ni poa.
mahali singependa ni kitengela or any place that originally belonged to maasai

[Tommy_Lee_Sparta]

@Acoustic

Haiya, are you my neighbor? Not riuriro anymore, but kwa Yuda. :D:D
Hiyo wizi ya transformer oil imezidi.

naona sisi ni majirani…may be ata huwa tunapatana pale Turako lakini tommy uko nje unaweza dhani ni member of parliament lakini watu wagejuwa ngwati ndio zimebuy iyo land

[Mr_Black]

@kawambui

you are forgetting the risks involved whereas the land is a sure thing

Wahindi wanamint millions, others billions from taking risks, this profit we get from appreciation of land prices is a fluke because

1. Most of our monies flow outwards in form of imports
2. Land prices somewhat fuel inflation because developers have to charge more to recoup their capital outlay, therefore higher rent which means less disposible income and reduced purchasing power.

We need to change.

[Acoustic]

@Yollo

We are not producing globally competitive products and cost of production in Kenya coupled with many taxes is what is killing manufacturing

No, we produce many extremely competitive products. The problem is our government doesn’t know how to secure global markets for its citizens. That’s the job of a president. For ex. India’s Modi (PM) will be coming to Kenya soon. He wants Kenya to allow Indian producers to sell their stuff in our supermarkets and malls. Right now I have lots of apple mangoes in my farm, which I wish I could sell for $4 a piece in the US or Europe. What Kenya needs is more special interest lobbying groups that represent their agenda in Parliament.

[kawambui]

@Tommy Lee Sparta

naona sisi ni majirani…may be ata huwa tunapatana pale Turako lakini tommy uko nje unaweza dhani ni member of parliament lakini watu wagejuwa ngwati ndio zimebuy iyo land

turaco ikifunguliwa 2010/2011 niliwekewa mchele hapo. sijawahi rudi

[kawambui]

@Fala 12

any where along thika superhighway and sorroundings. na kangundo road pia.
machakos nikipata pia ni poa.
mahali singependa ni kitengela or any place that originally belonged to maasai

na juja farm au landless?
juja farm ukiwa na 400k ni tuplot tuwili

[Fala_12]

@kawambui

turaco ikifunguliwa 2010/2011 niliwekewa mchele hapo. sijawahi rudi

kama uko twendi fo saa hii 2010 haukuwa umefika the legal drinking age

[kawambui]

@Mr Black

Wahindi wanamint millions, others billions from taking risks, this profit we get from appreciation of land prices is a fluke because

1. Most of our monies flow outwards in form of imports
2. Land prices somewhat fuel inflation because developers have to charge more to recoup their capital outlay, therefore higher rent which means less disposible income and reduced purchasing power.

We need to change.

if you are a not so shrewd you will never go against the tide.
you invest in a safe place

[Acoustic]

@Tommy Lee Sparta

naona sisi ni majirani…may be ata huwa tunapatana pale Turako lakini tommy uko nje unaweza dhani ni member of parliament lakini watu wagejuwa ngwati ndio zimebuy iyo land

Base yangu ni sides za Ndigithu hehee. Lakini siku hizi nimepanda bei naendaga rainbow. Umesikia lami iko karibu kuwekwa na world Bank? Kutoka kimbo hadi “kwa matangi…”

[kawambui]

@Fala 12

kama uko twendi fo saa hii 2010 haukuwa umefika the legal drinking age

kwani embu legal drinking age ni 40?
91-09feb si eighteen?

[Grundy]

@wheelz

I. Don’t. Even.

This is an example of how people do not maximise opportunity. Hence, opportunity cost. A 50x100 plot can fit 16 units. 8 bed sitters & 8 one bedroom units. This would cost 40m to construct.

Therefore, if I had 10m in cash, I would buy the plot for 3.5m. 6.5m will get me about 30m in debt. Enough for me to do my 16 units. Fully constructed & let out within 8 months. A bed-sitter would let out at 10k and a 1 bed at 13.5k. That’s 188k a month. Annually, that’s 2.25m. How you repay your debt out of this would depend on the interest rate you secured.

There are other factors here, tax, rental increase… blah blah blah… but point is, after paying your loan, approximately 5-9yrs, your property value will be more than Kes 60m. Now you’ll have an asset that is appreciating, and cash flow. Things that open up more opportunity.

Two points here, first, if you dedicated all your rent money towards repayment, it would take you more than 20 years to clear the debt.
Secondly, how easy is it for an ordinary Kenyan to secure a 30 million loan and how easy is it to have 10 million in cash. Your idea is brilliant but not very pragmatic.

[Fala_12]

@kawambui

na juja farm au landless?
juja farm ukiwa na 400k ni tuplot tuwili

good idea. nitaangalia huko

[WuTang]

@Mzee mzima

Kweli bedsitter ni mangapi?

Inadepend

[wheelz]

@Grundy

Two points here, first, if you dedicated all your rent money towards repayment, it would take you more than 20 years to clear the debt.
Secondly, how easy is it for an ordinary Kenyan to secure a 30 million loan and how easy is it to have 10 million in cash. Your idea is brilliant but not very pragmatic.

1. Refer to point on interest rates. Guys are accessing loans as low as 6% p.a. The model, figures are tweaked to get the desired period.
2. The discussion was based on a premise of Kes. 10m in cash. With the right factors in play, leveraging this for financing debt is not difficult.

[bjurmann]

@Mr Black

Wahindi wanamint millions, others billions from taking risks, this profit we get from appreciation of land prices is a fluke because

1. Most of our monies flow outwards in form of imports
2. Land prices somewhat fuel inflation because developers have to charge more to recoup their capital outlay, therefore higher rent which means less disposible income and reduced purchasing power.

We need to change.

Wewe mujamaa nakumulika Sana juu ya hizi points zako. Lets cut to the chase…give me examples of something that fits your bracket that can lead to wealth direction. Observation zako ziko on point.