CANDID TALK

what we don't say out loud.

Time to invest….

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Away from politics and lets turn the ‘lemon’ mood into some lemonade. He who has ear let him hear (Matt 11:15); the best time to invest is NOW. When I talk of investment I mean property and not volatile shares, stocks or bonds …Nah ….I am referring to Land Banking. The season is right and the mood also is right. Buy low, sell high has always been the best way from time in memorial for any investor anywhere in the world. Currently the circulation of money is low in the economy due to the hailing political instability, therefore, ceteris paribus, the demand for property is low but the supply is high.

Common satellite towns have in the last few years gotten an influx of investors from big cities buying large chunks of land for speculation purposes. I tell you for free you can never go wrong on land.Areas like Juja,Kitengela,Kagundo road,Narok,Maaimahiu,Naivasha,Nanyuki,Malindi,Lamu,Isiolo & Mombasa are some of the locations where there is land availability and the pricing is fairly affordable especially for the middle-income earners.

According to Hass Consult’s land price index for the first quarter of this year, an investor is better off banking on land in these locations as opposed to stocks, bonds or treasury bills. For example, a person who bought an acre of land in 2007 for a million shillings in these areas would have seen his investment rise to Shs 6.4 million by beginning of this year.

A similar investment would have earned him less than a million shillings through the bond market in the same period. What if he had put the money in a savings account? He would have earned a partly Shs 140, 000 in eight years.

The problems with these areas is the means of transport.Kenyans mostly purchase property (the proverbial ka one eighth-1/8) for the purposes of building homes as instilled by our parents. The assumption is that most of us still use Public means or Taxi making it too hard to relocate to such places for residential purposes. We therefore, turn to take home mortgages that tie our incomes for the rest of our working life. But with patience the light rail will be the savior to these areas as well as increased development due to the exposure it will bring. My advice is Buy, wait  & Sell later when the real value has been fully realized.

Largely, look for areas away from cities that are marked for Bypass roads, Airports, Railway system-SGR, Major highways, Electricity, Water, Schools and Churches. Such places open up for development faster than any other place lacking such amenities. It’s not rocket science, I bet we are in understanding.

 

Author: Kate Mwamba

Financial and lifestyle blogger

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