All investments with good returns involve some level of risk. However, this should not make you shy off investing in real estate and especially land.
Investing in land is one of the safest investment. This is because land does not have maintenance costs and it appreciates in value over a period of time.
Managing risk in any investment is advisable. In real estate due diligence is one of the ways to ensure you investment is safe.
Below are some risks of buying land, nevertheless, all these are caused by lack of proper due diligence at some point when investing in a property in any area in Kenya.
Weather conditions and patterns change over a period of time. Sometimes, it can dry for a long period, then later, long rains resume. In a dry season, you may end up purchasing a prime land that is located in riparian region.
A riparian zone is an area between a water body and dry land. In rainy seasons the areas can be prone to flooding.
To protect yourself from such a risk, always ensure that you buy land that has been surveyed and demarcated by a registered surveyor. Also, visit the property you intend to purchase before, during and after rainy seasons.
Every town has a land-use plan that is drawn and implement by County Governments. The plan divides the town into different areas including commercial, residential, agricultural, industrial or mixed-use.
Purchasing land in a residential area means that you can put up commercial facilities and vice versa.
To avoid such as scenario, always inquire the specific type of land on offer and get to know whether it is agricultural, commercial or residential. This will save you the frustration that may come when you need to develop the land.
Valuation of land is important when you are intending to own land. This protects you from possible exploitation from the seller and/or brokers.
This procedure will provide an estimate of the market value of the land and will help you avoid purchasing an overpriced property.
To avoid falling victim of purchasing an overpriced land, conduct a thorough research of the average price of land in an area of your interest before purchasing.
Land is classified into freehold and leasehold. A leasehold property has a limit to the number of years you own and make use of the property. A freehold property gives you absolute ownership of the land.
Before investing in any property, make inquiries on the type of property and get to know before you commit your money.
There are a number of genuine land selling companies in Kenya. However, a few companies do not deliver title deeds to clients.
Some Kenyans have been victims and have lost their hard earned money. To manage this risk, always work with a legit real estate company that have existed for a period of time and have delivered title deeds to their clients.