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How to Invest In Real Estate

As we launch our blog, we asked ourselves what topic we should start with. Better yet, what topic gives our clients (readers) nightmares? During our brainstorming sessions, we agreed to start with a topic we thought would be, it. Investing in Real estate. The World over, investing is a topic that whets people’s appetite.

We hope that this blog post will do you justice, by whetting your appetite of course. If you have ever struggled with the idea of whether to invest in real estate or not, we would like to speak to you. Read on. In the process, feel free to leave your comments at the end of the post. Along the way, gather important tips that will see you well on your way to becoming the best real estate investor, Kenya is yet to see.

Where to begin? Oh, a quote. ‘Landlords grow rich in their sleep.’  John Stuart Mill.  So, how do we cross over to the other side?

Property Search (Research)

Like any good student of both life and business, we all need to set out and find out more about that which we are interested in.

As a buyer, it is quite imperative that you decide what it is that you want. Write down, what specifications you are looking for in either land and or a house. ‘Do you want the residential property, commercial property, or even keep for future use say for capital gain?’  Says George Wachiuri.

Armed with your decision it’s time you made the right move.  With many non-licensed Real Estate cons out there, we suggest that you involve an honest agent to help you search. This option is for those pressed for time. To those will time to spare, DIY (do it yourself). How? By visiting the real estate, websites that you might know.

You can also go to other websites provided they are in the real estate industry (Lamudi.co.ke). If you own a car, do a drive search, whereby you visit various sites, regions, counties, etc. looking for potential properties.

 

Identify the Property

You have spent time going around searching for what you would call your dream property. Rather, your real estate agent has come to you with good news, that he has located the property you wanted. Once you are comfortable that the identified property fits your criteria and your heart and mind are in tandem, move to the next step.

Which is? Analysis and evaluation.  Heed this advice: It is very, very important that you meet the real property owner. If that proves difficult, as most property owners prefer anonymity (you know how billionaires are with their exclusivity) seek a meet up with the appointed agent.

Let them produce an appointment letter as the property’s agent. Either way, you are your foot is in the door, wear your negotiation hat. A tip in negotiation: always look out to get the best deal. Negotiate for the best deal in the market. Assuming that you have moved the property owner, you might just leave the site with an offer letter in-person or through your appointed Lawyers. Once the offer is accepted you need to go ahead and conduct due diligence.

Time to Lawyer up and conduct Due Diligence

Good for you: your workload is lessening by the day as you approach closure. Your lawyers (real estate agents) will conduct the due diligence and ensure that you are covered in the whole purchase process.

‘This is a very important step in property investment. You need to get a good lawyer to conduct a thorough due diligence in the lands registry offices. It is very important to verify the owner’s identification at the immigration, or if the property is owned by companies then check details with the registrar of companies.’ adds, George Mbogo.

Sale Agreement

This will only happen if there is a deal between the parties involved. The vendors and buyer’s lawyers take over the process. As a buyer, heed this advice: ensure that you get a credible lawyer who understands conveyance.  If the property is funded by the bank, then you can get a list of lawyers from them. This makes it easier as the Bank has already sieved the best lawyers.

Make Payments

Deposit the agreed monies at the time of executing the sale agreement. Depending on the percentages agreed upon: 10% or 30%. Depending on your agreement, with the property owner move with speed and make payments.

Finalise the Transaction
once the completion documents are forwarded to the buyer’s lawyer upon exchange of the letter of undertaking, you, my friend are well on your way to becoming an official and legal property owner! For that congratulations.

The final payment for the property is paid within 7 days of the transfer and registration of the property in the favour of the vendor.

We hope that this post has been useful. The other option that we are offering is, enlist the services of a credible real estate agency and or company. With many mushrooming agencies, it would be wise to know where to take your business. The post might have indicated the whole property investment as a simple plan process.

It is not. As anything good, takes hard work. Nevertheless, if you are pressed for time and see that indeed the process is tedious: let us do the work you. For a small commission, we will deliver final papers to you.

Happy investing!

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State seeks to help Kenyans buy its half million low cost houses

If you earn less than Sh100, 000 and can spare a third of your income, owning a home will be within your reach under a Government plan to spur a housing boom. The State has created a company to offer cheap loans to banks to target civil servants, self-employed persons, or salaried employees with mortgage of up to 30 years to reduce the pressure on repayment.

The Kenya Mortgage Refinancing Company (KMRC) will receive a Sh16.1 billion ($160 million) from the World Bank to start operations this month and will be owned by the Government and the private sector.

“KMRC will contribute to the broad objective of the Government of Kenya to deliver 500,000 affordable homes by 2022 targeting households with incomes of up to Sh100,000 per month,” the National Treasury said in a document pitched to bank bosses and sacco CEOs. Treasury Cabinet Secretary Henry Rotich yesterday told financial institution bosses in Nairobi that the Government aimed to own about 20 per cent of the firm and would pump in Sh1.5 billion fully paid share capital. The rest of the Sh5 billion authorised share capital will come from development partners, banks, and saccos interested in owning part of the remaining 80 per cent stake in a bid to professionalise it and release it from the clutches of bureaucracy.

There is a shortage of more than 200,000 housing units every year. Even with growing disposable incomes, Kenyans still find it difficult to buy homes using the mortgages currently in the market, which are usually short-term and expensive. In 2016, for the first time in five years, the number of mortgages in the country declined by 1.5 per cent from 24,458 to 24,085 attributed to less issuance of housing loans by banks, which tightened their underwriting standards following the implementation of the Banking Amendment Act 2015. The law capped lending rates at 4 percentage points above the Central Bank’s benchmark rate. A study by the Government showed that only 7 per cent of Kenyans living in rural areas can afford a house worth Sh1.7 million while in towns only 40 per cent can buy the least expensive built property.

Read more ….

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How fraudsters connive with top State officers to evict land owners

A cabal of land-hungry, well-connected and informed individuals continues to hold dozens of families and individuals at ransom through well-orchestrated schemes to dispossess them off of their property.

By colluding with employees at the Ministry of Lands, the Directorate of Criminal Intelligence, the Office of the Director of Public Prosecutions and the police, this group forcefully takes over private land through a mixture of forgeries, coercion and if all fails threats of death and death itself.

The courts have in the past demonstrated the impunity with which these individuals — top politicians, known businessmen and women and regime wheeler dealers — close ranks to fleece or forcefully take over land from helpless individuals and families.

Read more …..

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Video tour

The Consumer Financial Protection Bureau announced on Wednesday a proposal to delay the effective date of the TILA-RESPA Integrated Disclosure rule until Oct. 1.

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Real Estate Roundup!

May new home sales gain 2.2% from April

Sales of new single-family houses in May 2015 were at a seasonally adjusted annual rate of 546,000, which is up 2.2% from April, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. — From Housing Wire

3 ways to tame student loan debt and afford a mortgage

It’s no secret that student loans can make buying a home a challenge. But what exactly is the problem, and how can buyers overcome it? The problem is that student loans can be included in the buyer’s debt-to-income ratio, or DTI. — From Bankrate

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We’re ready for the TRID rules!

At 5 p.m. EST June 17, the Consumer Financial Protection Bureau issued a statement that the effective date for the TILA-RESPA Integrated Disclosure (TRID) rules would be pushed back to Oct. 1, 2015.

CFPB Director Richard Cordray said in a prepared statement: “The CFPB will be issuing a proposed amendment to delay the effective date of the Know Before You Owe rule until Oct. 1, 2015. We made this decision to correct an administrative error that we just discovered in meeting the requirements under federal law, which would have delayed the effective date of the rule by two weeks. We further believe that the additional time included in the proposed effective date would better accommodate the interests of the many consumers and providers whose families will be busy with the transition to the new school year at that time.”

Rainier Title has been working towards the TRID implementation for over a year and felt prepared for August 1st. However, with the proposed delay we will be taking this opportunity to continue our education and training of TRID. While we believe that we have been proactive and ready for this change, there are still so many unknowns that will have to be addressed at the time of implementation. The industry should still prepare for 45-60 days for transaction to close due to the new timing parameters of the forms.

We’re working hard to be ready for all changes!

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Why Live in New York

In contrast with New York City’s urban atmosphere, the vast majority of the state is dominated by farms, forests, rivers, mountains, and lakes. New York’s Adirondack Park is the largest state park in the United States. It is larger than the Yellowstone, Yosemite, Grand Canyon, Glacier and Olympic National Parks combined. New York established the first state park in the United States at Niagara Falls in 1885. Niagara Falls, on the Niagara River as it flows from Lake Erie to Lake Ontario, is a popular attraction.

The Hudson River begins at Lake Tear of the Clouds and flows south through the eastern part of the state without draining Lakes George or Champlain. Lake George empties at its north end into Lake Champlain, whose northern end extends into Canada, where it drains into the Richelieu and then the Saint Lawrence Rivers. Four of New York City’s five boroughs are on three islands at the mouth of the Hudson River: Manhattan Island; Staten Island; and Long Island, which contains Brooklyn and Queens on its western end.

Upstate and downstate are often used informally to distinguish New York City or its greater metropolitan area from the rest of New York State. The placement of a boundary between the two is a matter of great contention. Unofficial and loosely defined regions of Upstate New York include the Southern Tier, which often includes the counties along the border with Pennsylvania, and the North Country, which can mean anything from the strip along the Canadian border to everything north of the Mohawk River.

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Manhattan Apartments

In Manhattan, uptown means north (more precisely north-northeast, which is the direction the island and its street grid system is oriented) and downtown means south (south-southwest). This usage differs from that of most American cities, where downtown refers to the central business district. Manhattan has two central business districts, the Financial District at the southern tip of the island, and Midtown Manhattan. The term uptown also refers to the northern part of Manhattan above 72nd Street and downtown to the southern portion below 14th Street, with Midtown covering the area in between, though definitions can be rather fluid depending on the situation.

Though the grid does start with 1st Street, just north of Houston Street (pronounced HOW-stin), the grid does not fully take hold until north of 14th Street, where nearly all east-west streets are numerically identified, which increase from south to north to 220th Street, the highest numbered street on the island. Streets in Midtown are usually one way with a few exceptions (14th, 34th and 42nd to name a few). The rule of thumb is odd numbered streets run west while evens run east.