Buying your first house or any house for that matter can be a daunting task. Our first thought is always the financial obligation required to buy a home, however there is a lot more to home ownership than just the money.
Whether you are a seasoned investor or first-time buyer, here are six tips to consider when buying a house in Nairobi.
This is one of the most important factors to consider that is usually overlooked. In essence what you are asking yourself is ‘how long am I planning to stay in this house’ and therefore does the duration of stay make it economical to buy verses rent a house elsewhere in Nairobi. Depending on the location and build, a two bedroom rental apartment in Nairobi can go for Ksh 40,000 – Ksh 90,000. When you multiply this buy the number of months/ years you would like to stay in such a rental and within the same monthly price range it begins to give you an idea on what you could begin investing in your own home. Alternatively, you could also find that renting a house in Nairobi could be more affordable in the short-medium term.
Because most people in Nairobi purchase a house on mortgage, job security becomes a key factor on when and how you will begin your homeownership journey. No one wants to make a 20 or 30 year financial commitment without knowing they will be able to meet it stress free.
In Kenya, the most common form of real estate financing remains to be mortgages. However, this option is not massively taken up as it is most viable for well salaried individuals, which is not the case for most Kenyans. Other forms of financing available include construction loans, with banks in Kenya offering up to 60% financing for land purchase, and 70% for construction; however this may vary based on the organization. Other options are SACCOs, which currently provide about 90% of real estate financing in Kenya, pooling resources from friends and family, chamas and investment groups which are popular in Kenya, or tenant purchase schemes/ rent to own. Whichever option you consider, the best strategy is to start saving early.
A down payment is simply an initial payment (usually a percentage of the full purchase price) that is made by you, the purchaser, when buying your home on credit. When you consider your ideal home in Nairobi or other towns in Kenya, how much do you think this house will cost. Do your research, find an estimate of what your ideal home will cost and then calculate the down payment you will require. In Kenya, majority of banks require between 15- 30% of the property value as down payment. The higher the property value the lower the down payment required.
There are very many features in a house that are worth considering and that will heavily affect your final decision to buy a house in Nairobi. These include; location -areas like Karen, Runda, Kitusuru and Lavington attract different prices from areas such as Langata, Westlands and Parklands- location is key. Size of the house, number of bedrooms and bathrooms, open or closed kitchen layout, fitted appliances or none, age and maintenance of the house and ultimately, the purchase price, are all important features to consider when thinking about your home.
Once you have taken into consideration these key factors when thinking about your ideal house in Nairobi, Nakuru, Mombsa or Kenya at large, then engage a trusted real estate agent such as Lustman & Co to help you in the search and selection of your perfect home.
Remember, a real estate agency is able to help you search from a much wider selection of homes and ensure you receive value for your money!
All the best in your journey.