Investing in Real Estate in Kenya: Key Takeaways 

Investing in Real Estate in Kenya: Key Takeaways 

In the last few years,  the Kenyan real estate industry has recorded a notable growth. According to Cytonn, the Gross Domestic Product of Real estate industry has grown from 10.5% in 2000 to 12.6% in 2012 and 13.8% in 2016. The highlights of buying and selling in real estate industry can be satisfying. Real estate investment has been associated with wealth of many. The process of buying and selling of properties involves researching and gathering information in order to make informed decisions. The investment is capital intensive and this therefore calls for well informed decision. There are a few key takeaways when it comes to real estate investment.  

Having a real estate development plan 

Whether you are buying or selling, it is necessary have a development plan when it comes to real estate investment.  In all cases, you need to the opportunities that come along with that investment.  In your plan, make sure to include things like: risks associated, your preferences, target market as well as resources involved. The goal is to achieve your objectives and target and therefore,  these two are on the forefront of your development plan.   

Learn the market 

Quite a number of ways impact the real estate investment.  It includes the variation in pricing, location, tastes and preferences of the buyers. It Is advisable to study the market and gather all the necessary information before starting up a real estate investment. Things like interest rate are likely to affect the investment.   

Legislative issue 

Government policies can affect the economy positively or negatively.  Prices in real estate industry follow the cycles of economy. Policies such as tax incentives, deductions and subsidies can either boost or hinder the growth of real estate industry. While you are working on indulging yourself into the business,  consider that legislation has an influence on the industry.  

The common ways in which you can invest in real estate industry  

Generally,  the most common ways in which you can invest in real estate industry includes: rental properties,  flipping and REITs. 

Rental properties-this includes building or buying property then renting it out for regular income. Flipping on the other hand includes buying property and holding it for a few months, then selling it out quickly. The holding  of the property is usually for a short time. REITs involves when a corporation uses investors money to purchase and operate income properties. REITs stands for Real Estate Investment Trust.  

In all the three ways, consider what will work best for you as you invest.  

Risk Analysis  

Just like any other industry, real estate investment has it’s own risks. It is essential to note the potential risks to the business and ways to mitigate them.  

How to Get started in Real Estate Investing

Location 

The advantage of location of a property is as good as the property. In real estate industry, location is paramount and harnesses all the benefits of the industry.  Location determines the security of people, access to social amenities, accessibility to utilities as well as the growth of value of said property.  If there is anything to consider, it is the location of the property.   

In conclusion,  the issues discussed above are the minimal limits that should be considered while deciding on entering into the market of Real Estate industry.  They will influence your decisions as well as determine your stay in the said market.