Property for Rent in Kenya : All About Investing in a Rental Property Kenya
It is well known that real estate investing is a sure way to create a certain wealth in Kenya. The purchase of a rental property is a quick way to get a place in the real estate sector, unlike construction, that is a time consuming process.
From the moment you decide to buy a rental property to purchase, there are many things that go into the preparation period. This article offers tips on what to look for, how to do your homework, and what you need to know.
Precautions before investing
Do not throw yourself headlong into an improvised operation at the risk of suffering from: difficulties to rent, revision of the rent down which may resulting in a loss of profitability and impact on the financing plan, etc.).
Your priority: To inform yourself well, you will look at the type of housing, the rental market, the choice of the tenant and the type of rental property in Kenya (empty or furnished), the fixing of the rent, the financing and the credit, the taxation and the taxes, not forgetting the rental management.
A well-targeted investment: You will begin by defining your goals. The idea, in fact, is what do you intend to do with your investment?
If you want to collect rents in the long term, for example, you will not choose the same housing or the same address as if you want to take back the house or the apartment to live there or to house your children in a few years.
The right strategy for a good investment
Investing in real estate is asking the right questions: Do you intend to receive a rent in the form of rents? Would you like to resume housing in a few years to make it your future principal residence?
Will you sell it to cash a surplus value? Are you planning to house your children or pass on this property?
The right targets. It is according to the answers to these questions that you will define your strategy, therefore your objectives, which will determine the location and type of accommodation.
If you wish to live there for about ten years for your retirement, you will select it as if it were your main residence. For example, you can invest in a sought after main Nairobi city.
If you bet on the perception of rents and the profitability, you will opt for a commune with strong rental demand. To rent to a student imposes to choose a city which has a university pole.
Well placed, it is obliged. In all cases, choose a good location. The neighborhood must be pleasant and above all well served by public transport. The presence of local shops is a plus, as well as green spaces and security.
Do your homework before owning a rental property
The idea of owning a rental property in Kenya can be so exciting that you might want to get in there. Still, you should not be too enthusiastic to look for the important investment you are about to make.
You should start looking for real estate investments as soon as you decide to buy a rental property. Research on the following points –
- Recent trends in the real estate market
- How much will be needed and how much you can afford
- In which neighborhood do you want to invest and why
- The type of investment property you want to buy
- What is the average rent in the area?
- Which tenant segment you want to target and why
- Behavior of tenants
Rental Real Estate: Choosing a Good Location
To choose the address of your rental investment, make it as if you were going to live in the housing. You will opt for a nice neighborhood to live, well equipped and well served. If you invest in a supermarket or in a house, your tenant will be a family.
So think about the proximity of nurseries and schools. If you rent to a student, you will choose either a campus property or an apartment in the city center but connected to the university poles by public transport.
Always think about resale. If you put the good on the market, it must find quickly taker at good price, which is always easier with a good address.
In real estate jargon, this is called the depth of the market and it is an essential criterion. In a dynamic city, transactions are going well if the price is set objectively.
In sectors that are losing steam, there is nothing obvious about the added value and goods may have a hard time selling.
A buoyant rental market. Location is not the only criterion of choice. Be sure to select a buoyant market in which tenant demand is real.
The Nairobi and other major high real estate potential towns and cities, university towns, cities with positive net migration, border areas will allow you to rent your property without difficulty and with a rent ensuring good profitability.
Location: Conduct the investigation
Attention: In some average towns, a lot of new homes were built at where the rental supply is higher than demand and rents remain unattractive.
Screen the rental market of the chosen city. Learn about the state of supply and demand, the level and evolution of rents.
Take a look at our real estate projects in Kenya, which drain employees and potential tenants. Do you want to know more? Consult a Real Estate agent in kenya about a good location.
If you decide to become a homeowner, you have two options: build or buy a home already built. Many ask themselves what is the most interesting solution. Buy an existing property or build your own custom home?
This last idea may seem tempting but there are advantages and disadvantages to these two options. Here are some things that can help you make a decision on should you Build Or Buy A House In Kenya, based on your situation.
Related Read – Real Estate Kenya: Towns With High Growth Potential
Buy or build a house in Kenya: Which is the best solution?
Even though the existing home sales market is doing well, building a new home is still viable.
- The most expensive part is building materials. It is, therefore, best to look for land to build in an area with affordable local produce to help reduce costs.
- If you know anything about construction, you can save money by painting and doing other things yourself.
Related Read – Why Hire A Real Estate Agent In Kenya?
Building a house in Kenya: Disadvantages
If you want to build your house, know that it is not always the simplest solution. There are certain constraints that you need to be aware of before embarking on such a project.
- You will have to find an expert builder or, if you do not wish to delegate this task, find serious craftsmen. Use word-of-mouth to find reputable professionals around your home.
- You will need to visit the site regularly to check that everything is going according to plan.
- The building of a house takes time and can last up to one year. When choosing a new home, do not be in a hurry.
Related Read – Selling Your House For Profit In Kenya – Things To Consider
Building a house in Kenya: Advantages:
- you will evolve in a house that suits you and meets your needs;
- it will meet the new standards in force (Kenya building code 2018);
- it will be less energy-consuming than an old dwelling;
- you will be able to determine where it will be located;
Related Read – Process To Follow For Buying A House in Kenya
Advantages and Disadvantages Of Buying old house in Kenya
This option also has advantages and disadvantages. Investing in a home in Kenya meets expectations:
- in a hurry: it is often possible to access in a few months to his new home. It is an ideal solution for future owners who do not have the time needed to build a house ;
- those who wish to acquire a good city. It is indeed very difficult to find land for sale in urban areas. The further you get from the city center, the more likely you are to find a building space;
- for lovers of old stones: investing in the former is also a solution to acquire a charming house with exposed beams and stone walls;
- those looking for space: old houses often have large gardens, unlike new achievements. The cost of land for new homes is particularly high depending on the zone.
Related Read – Process To Follow For Buying A House in Kenya
Today, it is more financially attractive to invest in the former because the prices are stable. On the other hand, if you buy a home already built, you will not be able to choose its location. In addition, finding a house or apartment in Kenya that meets your specific expectations can be complicated.
It is often difficult to meet all the criteria. You will have to make concessions, especially in terms of interior layout. If some work is feasible, you cannot change the entire structure of the house unless you have a budget.
You can choose your preferred location: If you choose to buy the land first, you have the advantage of choosing your preferred area and route. Your heart is the king here; it must be happy with the area in which you choose to settle.
Related Read – Planning To Buy Property In Kenya – 13 Things To Consider
You are assured of a discount on materials – at a price not inflated: By participating directly in the purchase of building materials, you will probably save a lot, getting discounts that would otherwise have resulted in the pocket of others.
You can get the right materials: a ready-to-use home may have been built with materials (substandard) that you would not have approved if you had the option. By buying your own land and building a house yourself, you have the opportunity to choose the best materials.
You can choose your own architectural design: Almost all young men have a whimsical image of the type of house they would like to live in as adults. The only way to turn this dream into reality is to have your own land, to contact the best architect in the world, then to design a classic design that fits your idea.
Related Read – Top Real Estate Companies In Kenya 2019
Every aspect of your home is new: if you opt for a home already made, there is a good chance that some aspects of your home are the wardrobes or the interior fittings are too old and have been painstakingly worked with stacks of wallpapers and layer in layer of sharp varnish, to appear seemingly new. By doing your own home, you avoid such pitfalls.
You avoid the remorse of the buyer: this little flaw that you did not notice at the beginning and that bother you now to the point of giving you the impression to break it with the help of a ruthless hammer.
Or rots in the basement that at first did not seem to be there at first sight until you accidentally stepped on it and everything crumbles like an old tower in ruins. This is precisely what you will avoid by taking the initiative to buy land and diligently building a home that you and your children will cherish for decades.
You build at your own pace: when you do it yourself, you can take your time to undertake a major project of your life: build your own palace – one brick at a time.
Related Read – Buying Real Estate Property in Nairobi, Kenya
Finally, buying old housing involves making important checks as to the insulation and electrical installation, but also to the presence of hidden defects and fungi, such as marrow, a real plague for homeowners.
To make your choice between purchase and construction, look further into our projects: if you plan to stay less than 3 years in the Nairobi city where you intend to settle, the construction is probably not the best solution, because it will ask you already a year of waiting and a lot of investment in terms of time and money, but your efforts will not be rewarded in such a short time. If you are still not sure and have a doubt in mind, visit Hayer One, your go to real estate development company in Kenya.
Check Out Flats/Apartments For Sale In Kenya – By HayerOne
Do you want to sell your house for profit in future? It is sometimes more interesting to wait a few more years before acting out. Discover how much the sale of your property in Kenya can be optimal.
There is no minimum time limit for the resale of his house or apartment. In fact, nothing will stop you from selling your home as soon as you buy it.
But as the owner, you will surely want to at least get your bet back. In addition, taxation can also be another problem While Flipping A House For Profit.
Here are some information that can help you know when to sell your property in Kenya.
Buying Home As An Investment
After seven years of rising in real estate prices, the housing market in Kenya is now slowing falling as political uncertainty lingers after petitions are filed in the Supreme Court to overturn Uhuru Kenyatta’s election victory.
When a household develops a real estate acquisition project, in a majority of cases, they turn to the purchase of a house. In Kenya, single-family home remains the preferred home of buyers.
Beyond these reasons, buying a home in Kenya is also a lifestyle choice. Such a real estate project excludes in fact the centers of large cities (such as Nairobi, Mombasa) where house prices are un-affordable for most buyers.
A home purchase is therefore rather in a residential area, quiet, far from the turbulence of the hearts of cities.
It is also, most often, the acquisition of a principal residence; but in some cases, especially in areas with high tourism potential, it is possible to consider the choice of a house as a real estate investment opportunity in Kenya.
Is It A New house or old house?
Both possibilities have their advantages and disadvantages. Buying a house in the new home gives you the right to financial assistance, including the zero-rate loan and the property tax exemption for two years from the completion of the work (or up to five years if the housing respects certain standards).
In addition, the acquisition costs are lower (2 to 3%). However, if you want to build, you will first find a land to buy.
The purchase of a house in the old allows to live in a property with more charm and cachet, sometimes even stronger than new constructions (it all depends of course on the budget you have, the houses of charm in downtown costing much more than “newer” townhouses).
You can also benefit from the loan at zero rates if you are first-time buyer, but the conditions under more drastic than in the new .
Among the disadvantages include older materials, less efficient insulation (standards are older), ageing facilities, renovations to predict, a greater chance to discover hidden defects (administrative or not).
Did you bought a house to live in immediately or to renovate?
This is one of the golden rules of the real estate market kenya: if a seller wants to sell his property more easily, he must ensure that visitors can relate and feel themselves in the dream home.
This involves limiting as much as possible the number of objects and trinkets visible, or even a painting to give the property a more “neutral” appearance. Thus, when you visit the house, you are able to know quickly if you see, you put your furniture and your bags, without touching anything.
There is another possibility: buy an old house and renovate it. In this case, you must, before signing a sales agreement, take stock of the work scope to be planned: solidity of the building and state of its structure; waterproofing of the roof; insulation of walls, floor and attics; standards for electrical installations, gas, water and sanitation.
If you’re not a do-it-yourself , get a professional to point out the important points you should not miss. Also, consider that a home purchase to renovate involves embarking on some administrative steps to file preliminary declarations of work or even obtain building permits.
Generally, the longer you live in your main home, the more you will benefit. Indeed, we must first remember that real estate costs are high in France: it is therefore more profitable to buy for the long term.
Reselling too soon will involve new costs, such as:
- agency fees (if you have gone through the services of a real estate agency),
- diagnostic costs (to be done by experts for the resale of your property),
- a mortgage release fee (if you have borrowed money to buy the property you are reselling),
- condominium fees,
- real estate VAT, for property built less than five years ago (however, if it is your second sale in five years, you will not need to pay the tax anymore).
When you sell, you will also be required to pay taxes on capital gains you realize on sale in Kenya. But know that there are cases of exemptions:
- Sale or transfer of property of a deceased person for estate administration purposes.
- Transfers of family property between former spouses, spouses and close family members.
- Transfer for loan guarantee or debt.
- Transfer of land sales below 3 million KSh.
- Transfer of personal residence occupied for 3 years before the transfer.
- Record a property to an official receiver or liquidator.
- Sale of the property of the deceased during the administration.
- Machine transfers (e.g. motor vehicles).
- Issue of debentures or shares.
- Transfer by tax-exempt organizations (in accordance with the Income Tax Act, Cap 470)
- Public interest transfers authorized by the Treasury during restructuring or reorganization.
- Sale of less than 50 acres of farmland.
- Transfer of shares and other securities sold and purchased on the Nairobi Stock Exchange.
- Transfer of securities from the recognized pension plan.
- Income from the sale of property taxed elsewhere.
It will obviously be necessary to take into account the market price. When real estate prices rise, this is the right time to resell your property, hoping for more profit. Also note that the best time to sell is spring, as the number of applicants is the highest at this time of the year.
In addition to the price of the house, it is necessary to think about notary fees, property and housing taxes, maintenance costs and expenses.
If you have a home purchase project in mind or Planning To Buy Property In Kenya, then visit Hayer One, a multinational real estate development company in Kenya which deals in creating high-end residential apartments and offices in Nairobi.
Check Out Flats/Apartments For Sale In Kenya – By HayerOne
Despite the impatience of future owners, a real estate purchase calls for delays that cannot be avoided. The stages of the real estate transaction are at the same time administrative, financial and legal. They can take between one and six months, with an observed average of three months.
Offer to buy, signature of a preliminary contract, obtaining a mortgage, signature of the definitive act: discover the different stages of a real estate purchase.
You have found the house of your dreams. Following this wonderful find, a series of steps for buying real estate property in Kenya awaits you. At first, if the price of the property does not suit you, you have the opportunity to make an offer to buy at a lower price.
A real estate purchase is the dream of many people. You do not feel like a fish in the water facing the different stages of your real estate purchase? Here are some points you need to.
Know the seller of the property
During the process of buying a house in Kenya, it is essential that you know the seller even if you are doing business through lawyers.
Insist on meeting her because some agents will tell you that it is not possible. If the seller may not be able to meet with the buyer, the agent or counsel must be able to disclose all the details of the seller’s data.
Once you have obtained their identity or passport, have them checked with the Registrar of Persons or Immigration. If the seller is a corporation, obtain a copy of their registration certificate and check with the Registrar of Companies.
Get to know your agent/broker
The immediate person you will likely encounter during the process of buying a property in Kenya is a real estate agent or broker. It is good to know who you are dealing with. To do this, ask for the person’s ID card and always make a copy.
It is recommended to take their pictures too. Also, find out if they are registered or not. All registered real estate agents are published in the Gazette. Get a copy of the Kenya Gazette for reference. Also, ask for a copy of their registration certificate.
Please confirm if they are registered with the Registration Commission of Realtors. Find out the location of their offices.
Hire a professional real estate agent
A professional real estate inspector who reviews property and reports on its condition, including structural soundness, compliance with local housing codes, and the state and age of functional systems.
An inspector can also assess the presence of pests, such as termites, and environmental hazards, such as radon or asbestos. Sellers sometimes hire inspectors before selling their homes, and many provinces require sellers to report problems in their homes in advance or respond to legal action later.
It is advisable to ask sellers if they have completed a return or if they have an inspection report that you can consult.
To find a good inspector, ask for recommendations from your friends and a real estate agent. It is recommended to hire an engineer, architect or contractor who is bonded, licensed and insured, and who belongs to a commercial home inspection organization.
Some inspectors offer quotes for replacing or repairing defects in the house, so be sure to ask if these estimates are included in the fees. Ask how the inspector will report to you; it is customary to have a private appointment, plus a written report on its findings.
An unplanned inspection in your offer to purchase may require the seller to make repairs within a certain period of time, or allow you to cancel the transaction if an inspector finds any problems.
Often, both parties obtain estimates for repairs and negotiate concessions, such as advances. When all the terms and conditions of the purchase contract and legalization of a document in Kenya have been met, you can proceed to the details to conclude the contract.
You can do a final pass inspection just before the end of the contract to verify that repairs have been made and that the house is in the same condition as before the start of negotiations.
Once you have identified a land, it is always recommended to visit the land register to search for the land in question. You will need a copy of the seller’s title deed to facilitate the search.
It normally takes three days to get the results from the real owner of the land and if there is a reason to be cautious.
What is the value of the home?
To find out, you can contact an approved expert, real estate agents and notaries obviously have an excellent knowledge of the market and make this estimate for free.
You can also easily carry out a small study of the market: surf a real estate website, log in as an acquirer, enter in the criteria the characteristics of your house (garden, number of rooms, garage, area, other special features such as elevator or pool) and start the search.
The results will provide you with a good idea of the prices whether you are buying house or apartment in Kenya.
Also Read – How To Find Best Real Estate Agent in Kenya?
Be financially prepared
It does not escape, then you have to develop its budget. The budget allows you to establish your ability to pay and to define what kind of house you should shop for.
Future buyers must also remember that they need to dedicate a percentage of the house price to the down payment. Several options are available to those who do not have a big woollen stocking.
They can withdraw money from their banks under the home loan plan. With the tax refunds it generates, they can pay part of the loan and use the rest of the money for their down payment.
The promise of sale
The seller is the only one to commit to the sale of his home. The promise of sale is one of two types of pre-contract possible to sell your home. The other form of pre-contract is the sales agreement.
The promise of sale or the sales agreement is the step that precedes the definitive act of sale. Unlike the sales agreement between the two parties, the promise of sale is binding only on the seller.
After agreement between the buyer and the seller on the sale price of the house in Kenya, the next step in the real estate purchase is to sign a preliminary contract.
This preliminary contract makes it possible to secure the sale and to reserve the property. The preliminary contract may take the form of a sales agreement or a promise to sell.
Following the signing of the pre-contract, the buyer must look for a home loan. Finding a home loan is part of the real estate purchase process that precedes the signing of the final deed.
The compromise, or the promise of sale, very generally provides a suspensive condition for obtaining the loan by the purchaser. This suspensive condition allows the purchaser to cancel the sale if he does not obtain his loan.
After obtaining the mortgage, buyer and seller sign, before notary, the final act of sale.
What happens if the sale does not end?
With the promise of sale, here is what can happen if the sale is not made:
1st case: the seller withdraws from the sale before the buyer has lifted his option:
- The latter recovers the immobilization allowance
- Attention, it can ask the seller compensation for damages (usually 2 times the 10% of immobilization)
- The purchaser must therefore lift the option within the deadlines set in the contract
2nd case: the buyer does not cancel the option within the deadlines set in the contract:
- He may withdraw from the sale but the seller retains the immobilization allowance unless this is due to the non-fulfillment of a suspensive clause (issuance of a loan): in this case, he may recover his insurance immobilization
- The seller is released from the sale and can sell his house to another buyer
3rd case: the seller refuses the sale while the buyer has already lifted the option:
- The buyer recovers his immobilization insurance
- Attention: he is entitled to ask the seller for damages
The land sale agreement in Kenya
The sales agreement is one of two types of pre-contract possible to sell your home. The other form of pre-contract is the promise of sale. the promise of sale or the compromise of sale precedes the definitive act of sale.
Unlike the promise of sale that binds the seller and the purchaser, the sales agreement involves both parties. The sales agreement is a formal contract in which the buyer and the seller make a definite commitment to buy for one and to sell for the other a good at a price fixed by both parties.
The sales agreement launches the sale: then the seller and the buyer benefit from about 3 months to prepare the signing of the definitive act of sale
The signature: in front of the notary or under private seal
The sales agreement, like the promise of sale, can be signed at will:
- Private agreement :
- Between buyer and seller only
- Or in the presence of a real estate agent
- At the notary services Kenya (advised):
- Usually the seller
- Presence possible and advised by the notary of the buyer (the two notaries simply share the fees)
Good to know : the sales agreement is signed in as many copies as there are + 1 signatories to send the registered to the buyer and officially marks the beginning of the withdrawal period.
The buyer pays a deposit of approximately 10% of the selling price
When signing the sales agreement, the buyer pays the seller a deposit in order to reserve the house. Its amount generally ranges from 5 to 10% maximum of the selling price of the house:
- Private signature: the check is signed to the order of the notary who will take care of the definitive act of sale. it is delivered to the notary only at the end of the withdrawal period.
- Signature before the notary: the check is signed to the order of the notary, it is immediately cashed by the notary and deposited in an escrow account, it will not be affected until the final act of sale.
Buying or selling a house is an exciting time and can be managed with ease thanks to the expert of HayerOne that provides you better understanding of the process. If you are planning to buy propert in Kenya then talk to our experts.
Check Out Flats/Apartments For Sale In Kenya – By HayerOne
Kenya has been one of the favorite real estate destinations attracting foreign investors. With its well-preserved natural beauty and good connectivity, it is an excellent investment in the residential or commercial sector.
If you also plan to buy real estate property in Kenya here are some things to know.
1. Choose the land
It is very important to ensure that the land is not in a risk zone (eg: flood zone, clay soil, radon emission zone). Having a soil test done prior to purchase is a good idea.
2. Look for the suitable locality
Most of us want to live in the up market, but that’s not what we can afford and it’s not where we should start. Sometimes we have to lower our expectations and go after what we can afford.
Go shopping as many times as necessary. Understand the terrain and see what is available. Do not just choose the first house you find. The next house could be a little better.
Also Read – How To Find Best Real Estate Agent in Kenya?
3. Make an “Investigation” about the Contractor
Have you ever made a major purchase, like that of a car, lightly? In general, the answer is no and you should proceed with such seriousness before deciding to buy a property in Kenya.
The contractor is another good idea (eg ask neighbors who bought a property from the same builder if they are satisfied, check on the site and license if this builder holds its license and has already been the subject of an arbitration).
4. Check the soundproofing
When buying a condominium, any occupant wants to be sure that the walls and floors are soundproofed. For this, it is generally preferable to opt for a concrete construction, for its soundproofing properties, although some innovative wooden constructions now have excellent performance in this regard.
Also Read – Fees Involved In Buying Property In Kenya
5. Consider insulation
It is obviously in your interest to make sure that the property is built to the highest standards of insulation.
This way, you will not jump to the ceiling when you receive your heating bills. To maintain good air quality in a watertight house, you should also check that the heat recovery ventilator is of good quality and has sufficient power.
6. Inspect doors and windows
Make sure you have good insulating and soundproofing doors and ensure windows are installed properly (eg, from the inside rather than the outside), that the framing is well insulated and caulked and that the inside of the double glazing contains a Low E-film that reduces thermal losses.
7. Check the building code in force
Municipalities are free to apply the building code they wish on their territory, but compliance with the latest code should ensure a better quality of construction.
8. Ensure the quality of materials used
Some contractors use flashy, cheaper materials rather than durable materials. We must be vigilant and ensure that we get a good price-quality ratio.
A quartz kitchen countertop will be more durable than a laminate or melamine countertop, while hardwood floors will also have a longer life than floating floors.
9. Engage an inspector
For the duration of the construction, you can hire an inspector, preferably a member of a professional order (architect, engineer or professional technologist), because he has insurance.
The latter will check the various stages of construction and ask the manufacturer to correct a defect, fine-tune a finish, put a more efficient insulation in the walls, etc. The builder may not like it, but you’re in charge.
Also Read – Buying Home In Kenya For First Time?
10. Acquiring a LEED Certified Property
Purchasing a LEED certified property is a bit more expensive than buying an ordinary property, but it pays off. You will live in a healthy building built with more durable materials and you will save on heating costs. In addition, you can surely sell your property more expensive.
11. Read Legal Fine Print
Before signing on the dotted line, understand the terms of payment and use a lawyer. Get the documentation you need and read it carefully. You need documents from the mortgage company, legal documents, the sales contract, the rental agreement, etc.
Gather all these documents and study them. Understand them and consult your lawyer to understand what you are buying.
You will meet a lot of people who tell you “I buy this house” and when you will ask them how much they cost, they will quickly tell you the cost, but if you ask them what is the payment plan, they have no idea.
12. Do not get caught up in the game.
Home ownership has become popular in Kenya. For this reason, many dishonest people sell ghost houses to gullible buyers.
People do not understand what is needed, so someone can tell a story and many people will believe it. So better play smart and read following tips to Buying Real Estate Property in Nairobi.
The purchase of a property should not be rushed. Sometimes you’re just not ready and sometimes it’s not the right property.
You must visit the site before you commit to purchase the property. Whether you buy it off plan or buy a house under construction or already ready, you have to see it.
If someone asks you to pay an amount to go see a house, it should be the number one red flag.
You can even go to the site without the seller, because if the seller is dishonest, you can just discover lies on the site.
13. Beware of hidden costs
When negotiating for financing, the borrower must be attentive to the actual cost of the loan. In addition to the interest rate, there are also hidden costs such as appraisal fees, legal fees and loan negotiation fees.
When you take out a mortgage Kenya, make sure you know the consequences of a fixed or variable rate mortgage.
Despite these tips, taking the plunge can be stressful. The ideal is to contact us as we want to establish a good relationship with you by providing you with the best property. You can also have a look at top real estate developers in Kenya
Check Out Flats/Apartments For Sale In Kenya – By Hayer One
Beyond the sale price of the property he covets, the buyer will have to face many other costs: notary fees, agency fees, mortgage, taxes specific to housing, condominium fees etc.
The main cost is the government’s Stamp Duty, which is 4% of the purchase price. You will also have to pay your lawyer about 1.25% of the purchase price for his role in the process. Buyers should be aware of this because most sellers tend to write the contract so that the buyer also pays the seller’s lawyer’s fees.
Therefore, buyers must be passionate about these details. If the buyers take out financing, they must take into account the evaluation costs representing 0.2% of the assessment and the 1% commitment fee to the bank.
Have all the cards in hand and build your project by getting help with our content! Let know more about the types of fees involved in buying property in kenya below.
What Fees Are Involved When Buying a Property in Kenya?
1. Notary fees
The terminology “notary fees” is not quite right because the majority of this expense is constituted by tax rights that the notary collects and returns to the Treasury.
Notary fees are borne by the person to whom the transaction benefits: the buyer.
Notary fees are subject to a mandatory fee which is the same, regardless of the place of establishment of the notary who receives the sale.
They vary according to the amount of the purchase:
the lower the amount of the purchase, the higher the costs;
conversely, the greater the amount of the purchase, the more these costs are proportionately low.
Tip to reduce the costs of notary: pay the movable property component housing (kitchen or bathroom equipped, blinds, appliances, etc.) separately from the purchase of real estate. Thus, the basis for calculating fees is lower so the notary fees decrease.
Finally, the fees of the notary are governed by decree so it is impossible to negotiate unless the notary decides to do its work for free (which can be conceived for a customer carrying out many transactions with the notary).
2. Estate agency fees
The agency has the choice when signing the mandate to sell its commission to the seller (in this case, it is included in the selling price) or the buyer.
The most common situation is when the agency fees are borne by the buyer.
Unlike notary fees, agency fees are not regulated by law and are freely negotiated between the seller and the agency.
They generally rise between 3 and 6% of the selling price.
The amount of agency fees is decreasing, that means the sale price of a luxury villa will be applied a lower percentage .
When the buyer makes an offer to buy less than the selling price and this offer is accepted by the seller, the agency will have to reduce its commission.
Note: The payment of agency fees takes place at the time of signing the deed of sale at the notary.
What if this signature never takes place? The real estate agent will not receive a commission,
however, there are ways to take legal action to collect damages.
3. The Mortgage
The majority of buyers finance their property on credit.
The buyer must repay the borrowed capital with an interest rate and ancillary costs (insurance, fees, prepayment penalties, etc).
The buyer must know that the more important his personal contribution is, the lower the interest rate.
The buyer is advised to contact a mortgage broker who will negotiate on his behalf with financial institutions.
4. Different taxes related to housing in Kenya
1. Property tax
This is an annual tax levied by the local government based on the location and value of the property. It usually represents about 1% of the property value.
2. Land tax
The land tax is a local tax whose rates vary according to the location of the land. The highest rate is 8% and applies to Nairobi.
Stamp Duty Act: The purpose of this bill is to amend the Stamp Duty Act by exempting new homeowners under the affordable housing program. The Stamp duty rates in Kenya varies between
2% and 4% on the value of the property depending on the location. The incentive will be a positive development for the new owners.
5. Condo fees
The condominium fees are due with respect to the trustee by the person who is co-owner at their due date.
An agreement between the seller and the buyer decides otherwise in the deed of sale.
If the sale occurs during a quarter, there will be prorata temporal distribution of co-ownership charges between the seller and the buyer.
Attention: this act affects only between the seller and the buyer since for the trustee it is the co-owner at the time of the call for funds which is fully liable for charges.
However, if a supplementary call or a refund takes place at the end of the financial year (once the sale has been concluded), it is the one who is the co-owner at that time who will be the sole beneficiary or the only one liable.
6. Works voted by the co-ownership
The rule is the same as for the charges of co-ownership: the work is due by the one who is co-owner at the time when the calls of funds are to be regulated.
Nothing prevents the seller and the buyer from agreeing to a different distribution.
Here is what is most commonly expected in the deed of sale:the works voted before the compromise are the responsibility of the seller;for works voted between the compromise and the authentic deed, they are the responsibility of the seller unless he gives the purchaser power to attend the general meeting and to vote in his place.
7. Does the acquirer still have to pay these fees?
The buyer is obliged to pay the notary fees:
The notary may also refuse to close the sale until the purchaser has paid the amount of the provision on notary fees.
This sum must be paid by the purchaser at the stage of the preliminary contract and is deducted from the notary fees.
As for real estate agency fees, the buyer, if he does not pay them, can be worried only in one hypothesis: when he has concluded a mandate with the real estate agency. (This is the case when the buyer has given a mandate to the real estate property development company in kenya to research, negotiate and facilitate the acquisition of a property.)
Also Read – Top Real Estate Companies In Kenya
Since 2000 real estate in Kenya has been rising steadily, as more and more Kenyans are interested in owning land and real estate. This boom has led to the growth of many real estate companies and real estate professionals. You will always get help for any type of property you want to buy, whether it is a residential or commercial property.
A diversified and experienced management team, with extensive experience in the Kenyan real estate market, manages most properties in Kenya. Many top real estate companies in Kenya specialize in real estate in large cities, some with branches in rural Kenya. These property development companies are known for their portfolio of land, a sale of land, apartments and home ownership.
For someone who ventures into the Kenyan market, especially as a buyer, it is not enough to look for real estate in Nairobi or Kenya online. This is just a step in the right direction, but knowing who to contact every time you need an apartment will make your job easier.
Here is a List of top real estate property Developers in Kenya you can call anywhere in Kenya to help you find a home.
List of Best Real Estate Companies in Kenya (2019)
- Hayer One Ltd
- Gakuyo Real Estate
- Azizi Realtors
- Llyod Masika
- Villa Care Ltd
- Suraya Property Group
- Hass Consult Ltd
- Optiven enterprise ltd Kenya
- Dinara Developers
- Myspace Properties Kenya
1. Hayer One Ltd
Hayer One, one of the top upcoming Real Estate Property development company in Kenya in 2018, was created with a clear vision of providing high quality and personalized services to individuals, private sector companies and government clients in Kenya.
If you are a potential buyer and looking for a house or apartment, or need help in buying real estate in Nairobi, then you should visit Hayer One, a property management company with the best real estate agent in Kenya.
The mission of the Hayer One group is simple. Believe that the fastest way to succeed is to help others. To fulfill this mission, they develop, build and ensure ownership. But more than real estate developers in Kenya, the Hayer One team is an emotion developer for many families.
Don’t Miss to Check Out Our Latest Developments :
2. Gakuyo Real Estate
Real estate Gakuyo too represents a unique opportunity for the investor in Kenya. You get a double benefit when you invest with Gakuyo. The company gives you the opportunity to own land and invest in agribusiness projects, allowing you to earn money as soon as the products are harvested.
Gakuyo real estate agents, who promise good value, manage this lucrative business. The project’s products are sold in the closest markets in Makongeni and Thika, which means that the project owners are guaranteed to make quick money once they have bought the land.
3. Azizi Realtors
Azizi Realtors was created to offer professional real estate consulting services by creating synergies in operational real estate through integrity, transparency and speed of service delivery.
The company’s executives and senior executives have a combined total experience of more than 30 years in real estate sales, leasing, property management and real estate investment consulting.
The company specializes in prime properties in Nairobi and the rest of the country.
4. Llyod Masika
Lloyd Masika Limited is one of the leading real estate agencies in Kenya and is registered. He provides professional valuation and real estate services in Kenya. Created since 1979, it is structured in three main departments, complementary in the provision of services.
5. Villa Care Ltd
A company that owns some of the best real estate agents in Kenya. It focuses on providing quality, customized and customized services to clients. The fast and steady growth of the company ensures that you deal with the best in the industry.
6. Suraya Property Group
Suraya Property Group Ltd is a real estate company created in 2006 by Pete and Sue Muraya. Suraya Property aims to become the leading real estate development company in Africa by creating lifestyles that change the way people LIVE, WORK and PLAY through innovative, environmentally friendly and affordable developments.
7. Hass Consult Ltd
It is one of the top real estate developers in Nairobi whose impact is felt in Kenya since its creation in 1992. The company manages a number of real estate services, including consulting, sales, rental and management of commercial and residential buildings.
8. Optiven enterprise ltd Kenya
This is a reliable real estate agency in Kenya. The company is known for locating prime properties in Kenya. If you are looking for a place to invest, especially in the purchase of land, contact the team. Optiven offers customers the best deals at affordable and reasonable rates.
The projects proposed by Optiven are often futuristic and aim to help investors get a quick return on their money once they are launched. Strategic locations close to amenities often characterize properties, but their cost and payment plan are unbeatable.
9. Dinara Developers
Over the years, Dinara Developers has become a company offering the development of affordable and quality housing.
Outside of Dinara Developers selling land; purchase large parcels of land and subdivide them for sale to individuals; they also add value to the land before the sale.
10. Myspace Properties Kenya
Myspace Properties is a good choice when it comes to immersing yourself in real estate kenya, development and the housing sector in Kenya. They aim to provide the best services and respond to Kenya’s real estate boom, specifically in Mombasa, benefiting buyers, investors, owners and developers to meet their needs.
As the real estate investment in Kenya continue to grow. The Top Real Estate Companies in Kenya mentioned above can be a guide for beginners. Young people are acquiring land and property, which means that this industry is growing more and more.
Also Read Other Posts:
Location, quality, expenses, resale: as many criteria to identify when choosing between a house or an apartment in Kenya. Our tips for successful purchase of real estate Kenya.
Should you choose an apartment or a house when you buy your residence? The answer comes from your personal taste.
The criteria for buying the best residence
To determine the best residence between home and apartment, you must first know what are the criteria to follow. There is more than a dozen, certainly as important as each other, but not having the same value, however. Therefore it is necessary before choosing what type of residence, to consider only the most relevant criteria. Even if, the other criteria remain interesting as they generally result from those which you will have retained. So do not neglect them. Here are some criteria to help you:
What are the difference in prices of house or apartment in kenya?
The apartment. Its price depends on the address, the state of housing, its surface. In the old, the envelope that you spend on the work will be less important than in the house. Another important point: you have to budget the expenses of co-ownership. Transfer taxes and other ancillary costs are calculated as a percentage of the price. These expenses are the responsibility of the buyer. In this area, comparing apartment and house makes little sense.
The House. The price is calculated according to the same criteria as that of the apartment, naturally taking into account the specifications of the house (distance from urbanized areas, size of the garden, presence of a swimming pool, etc.). Transfer duties and ancillary costs are fixed in the same way as for apartments.
What to check before buying
- The location (city, neighborhood, situation in the building, orientation, etc.).
- Urban planning projects, new services, etc.
- The quality and condition of the accommodation. The work to be planned and therefore budgeted.
- The technical diagnostics file.
- The co-ownership regulations, the distribution of expenses and their amount, which was voted and paid by the co-owners.
- he quality of the Internet connection.
- Local taxes on apartments in Nairobi.
The location (city district, proximity to services, distances to travel daily, etc.).
The quality and condition of the accommodation, its equipment. The work to be planned (and therefore budgeted).
- The amount of charges (heating, water, etc.).
- The quality of the Internet connection.
- Town planning rules applicable to the house and the land, easements that can encumber the property (in town hall).
- In subdivision, bylaw and specifications. The regulations for development of houses.
Opt to buy an apartment in Kenya
There are several types of real estate (furnished studios, apartment, house, etc.) on which an investment can be made. The most important to better choose the property on which you will invest is to take into account the important criteria noted above. To this end, if buying an apartment seems less affordable than buying a studio located in an equivalent area, in terms of profitability, the apartment, however, offers assets that are not necessarily found in a studio.
Indeed, apartment tenants are more stable.
This shelters you from rental holidays that can mean lost income for your investment. With apartments, there is little risk of property degradation as tenants tend to stay longer. They are therefore interested in taking good care of their homes. Another advantage of choosing to invest in an apartment is that it is usually more likely to be rented to many, and therefore, there is a small risk of rent unpaid for you.
However, before buying an apartment in kenya, you must make sure that its profitability is good. Often, it is found that the profitability of a smaller dwelling is greater than that of a dwelling having a large area, and for apartments, it is possible to obtain a rental yield of at least 5%.
In addition to the advantages mentioned above, buying an apartment has certain advantages that must be emphasized:
- The purchase price of the apartment is not too high . Everything will depend on the country in which you decided to invest in a rental apartment, cities, urban areas, etc. Prices will vary according to these criteria and will be greater or less important depending on these criteria;
- Depending on the level of standing , the apartment in which you will invest will be housed in a building with pleasant and diverse common areas (tennis courts, gym and gym, swimming pool, garden, etc.).
Buying an apartment in kenya does not only have positive aspects. You will face some constraints, here are some of them:
- You should participate in the condo fees ;
- It is not always easy for many to live in co-ownership, and so it will be a little difficult to find good tenants who respect the collective environment ;
- The apartments experience a rotation of tenants stronger than that of houses for example. While students and young couples will be more flattered by apartment living, families will tend to enjoy the comforts of home. Families are known to move less than students and young couples.
Opt to Buy a house in Kenya
Studies show that 80% of Kenyan people prefer to live in a house. The same is true for tenants, who in many cases solicit this type of property. Every year, no less than 100,000 families in France are looking for a house to rent. However, demand remains higher than supply, to the point where we consider that to reverse the trend, we must build 15,000 homes each year for 10 years to cover all needs. It is enough that the houses are located in an attractive location, and that the prices of the rents practiced on these correspond to the market price, to rent them with much to facilitate.
From this point of view, buying a house rather than an apartment would be more profitable and beneficial for the buyer.
Buying a house brings stability
For those who invest in a house, which is owner-lessor , to rent his house will offer him an important peace of mind. For rented houses, tenants usually stay there for an average of 80 months, while for rented apartments, this trend is not as important (30 to 40 months). This is great news for your investment, because in this case, rents will be perceived with more regularity, not to mention that rental reports are also more peaceful and healthy.
There is less risk of unpaid rents for rental homes. Houses appear as homes in which families live, for the sake of stability and serenity, they will be more willing to pay their rents with great rigor, which is a good thing for you as an investor. Moreover, families will appropriate the property over time, and because they maintain it properly, the charges will be lower than those of an apartment for example.
For a house, the rental yield will vary around 3 to 5% in Kenya. Buying a house brings a lot of stability and security . It is a type of property particularly appreciated, and one comes out necessarily satisfied as an investor.
Just as it is also the case with the apartment, buying a home also has some disadvantages. Among these, we can note:
- The high cost of acquiring the good or the ticket of entry on the market ;
- For this type of real estate investment, there are more maintenance costs to bear;
- There is also very little or almost no private green space with a house.
Kenya Real Estate Market Analysis
Population and household data allow you to quantify the current size of the market and extrapolate future growth. The population is defined as all people living in a geographical area (ethnicity, income and age wise). Households include one or more persons living together in the same dwelling, regardless of their relationship (this includes all occupied dwellings.) Households can be classified by size, composition or stage in the family’s life cycle. By a recent data analysis of Kenyan real estate dominant by:
- Indigenous Kenyan of Age Band: 45 to 55 years.
- 70% of these Kenyan citizens are taking interest in real estate investment.
- This real estate boom stated in the Kilimani, Milimani, Kileleshwa, Westland etc.
- Citizens with the salary of Keshs.0.35m to Kshs.0.4m p.m are taking more interest in the Kenyan real estate whether they are Asian or other immigrants.
Above given demographical data reveals information regarding the interest of people in Kenyan real estate. Analysis of overall household and population growth provides a “big picture” of potential demand in the retail sector in Kenya.
The real estate market in Kenya considered very profitable and lucrative registered the arrival of several investors, whether public or private, local or foreign. For the construction of social housing or luxury apartments and private through shopping centers, hotel complexes etc. What seems risky to today will pay dividends in the long run…at least the numbers suggest so.
To know which real estate investment in Kenya is the best between a house and an apartment, several criteria of appreciation must be taken into account. These criteria apply to all types of real estate. House and apartment offer reasons to invest in terms of their advantages, but also their disadvantages. However, it is possible that your financial abilities come into play to favor one over the other. Keeping in mind all scenarios you must find yourself a best real estate agent in Kenya. Else feel free to consult us and our property developers in kenya will help you in making an ideal decision.
Check Out Flats/Apartments For Sale In Kenya – By HayerOne
- Real Estate Property Valuation in Kenya – Buy or Resale
- Buying Real Estate Property in Nairobi, Kenya – 2018 Guide
- Which Are The Best Real Estate Investment Opportunities In Kenya In 2018?
Finding a real estate property is a big challenge for every home seeker. To begin with, a real estate agent is the essence of home buying. He can help you buy the right property with his years of experience and knowledge in property search and sale.
Real estate agent in Kenya
If you are a potential home buyer and looking for an agent to help you buy real estate property in Nairobi, here are some important tips you must take care of while looking for a Property Management Company or a real estate agent in Kenya:
⚪ Ask for References:
We all have one or more friends who recently purchased a new home. They will be having good links with their agents. You can get references of one or more agents and fix an appointment to better know them. Try to find out how long they have been into this profession.
Ask for their area of expertise. You must know how your agent will handle their situation in a bidding war. In addition to this, it is essential to know about his reputation in the real estate market in Kenya.
If the agent is a renowned personality, check on internet if the person is involved in any of fraudulent activity.
⚪ Know Their Availability:
Purchasing a new home takes a lot of research so make sure you give proper time to your biggest investment Start with finding an agent that can manage himself to do real research work Commonly, some agents work with ‘N’ number of clients due to which they need to limit their flexibility and align this job to few hours. This may result in wastage of time and efforts. Therefore, go for an agent that has a team of experts working under him so that they can allocate proper time towards your specific needs and find a dream home for you and your family.
⚪ Give Time To Your Agent:
Finding an agent doesn’t mean you hand over all your job to one person and sit relaxed waiting for a property. One has to understand his or her agent and know how to assist him. This can be accomplished by conducting meetings twice a week and a regular phone call to check the status of progress. Ask if you can help the agent in any possible way.
⚪ A Right Real Estate Agent
Listens to You: Make sure your agent is an active listener. This is what every home buyer is selling in his or her agent. Make a wish-list defining what you are looking for in your property – whether a luxury apartment or a reasonable property at a prime location. Tell them everything about your idea of planning and budget and then leave things on them. Let them find a property close to your expectations. See if your agent even remembers what you shared with them. If yes, you have made a perfect choice. If not, keep looking for agent.
⚪ Test Their Knowledge:
This is the most important aspect and plays a big role in finding right property. Do the agent have answers to your property related queries? What if you need to chase them to get an answer? A quality agent should be able to quickly prove you with the entire information like neighborhoods, general price ranges, nearby businesses, and so on. If an agent cannot provide specific details, you should look for someone who knows it better.
⚪ Verify Your Agent’s License:
Of Course, we all want a trust-able person to take over this responsibility of searching property at a prime location. There are some licensed agents in every area. You can prepare a list of real estate agents in kenya online and reach out to them. Meet these agents one by one. Ask them every necessary questions to know what their focus is in the real estate industry of Kenya.
⚪ Find a localised agent:
We’d recommend you to find an agent that lives nearby the area you’re looking property in. He will be aware of the best neighborhoods and trends. A local agent helps you search property with all primary amenities like all necessary shops, school, college, hospital are at commutable distance. This is actually how a real estate agent works.
Also Read – Real Estate Market Boom In Kenya 2018
⚪ Ask your friends and families for referrals:
Ask a friend or any family member to know who are likely to give you honest assessments of their experience with a particular agent. It’s not recommended that you choose any agent only because your friend suggested. There can be a difference between what your friend bought and what you’re expecting.This way, you’ll get a sense if the agent has any major flaws that would be a deal breaker for you.
⚪ Loyalty Factor:
It clearly means that the real estate agent must think about buyer’s best purchase over their own benefits. He should be willing to sacrifice his own commission for client’s interest. An agent should be loyal to his client whether a buyer or a seller. He should not try to influence his client to pay more or spend less for the sake of agent’s own personal gain.
Do What Your Heart Says:
People can usually realize if they like someone or not. So, when you meet the agents, this is completely up to your instincts to choose a person or not. A realtor should be a reliable and trustworthy person. So, if you realize that the agent seems like the salesman type, never choose such a person. They are most likely to be interested in their commission than your best deal.
If you are willing to purchase a residential property or you are a potential homebuyer searching for a good property at best price, check out our website.
From designed to the end finishing, we ensure that our properties meet your expectations giving you peace of mind and a sense of security.
We are the regions first real estate development company in Kenya that is aiming to deliver luxury & lifestyle properties under amazing mortgage off plan purchase offers.
Want to know more about HayerOne – One Of The Leading Real Estate Developers In Kenya
Flats/Apartments and commercial properties for sale and for rent in and around Kenya. Discover our range of properties. Don’t Miss to Check Out Our Latest Developments :
The expected charges of construction plans that are approved by Nairobi City County in 2017 between January to May cut-price to Sh105.6 billion from Sh126.3 billion in last year which has been reported by the Kenya National Bureau of Statistics (KNBS). However, many assume that it will speed up and went down faster once the election-related activities end. (more…)