Despite the harsh economic conditions hampering millennial ability to buy property, it has done nothing to stifle their enthusiasm.
Investing in land or real estate, was once considered something one should do later on in their life time. While there is nothing wrong with investing at the later stages in life, most young people believe that it is not possible to invest in land until one is established and experienced enough in life. This could perhaps be in their forties, fifties or even sixties.
For long real estate was reserved for the affluent and the well connected. However, a new trend is emerging. Millennials, the generation currently aged between the age of 25 and 35, are increasingly becoming the most important generation for developers.
“Buoyed by disposable income and burgeoning investment acumen young people have realized the need to prepare well for the future. Investing in your twenties or thirties is not only a possibility but it’s the best decision one can make,” says Reuben Kimani the co-founder and the C.E.O of Username Investment Limited. He add that the sector has proven to be the finest avenue for creating wealth
Username Investment, is among a few companies in Kenya offering real estate products targeting millennial. Kimani says a huge percentage of these population have well-paying jobs and are now looking at the best places to put their money.
Real estate investment, he explains, provides higher returns compared to other investment options. “The returns in the sector continue to remain high at an average of about 25.8 per cent with a capital appreciation of 17.4 per cent over the last six years.”
“Our main focus is to offer products that are not only affordable but also offer value for investment. Most of the clients we have are demanding. These are people on their first jobs and are looking for properties to develop within a period of five to six years of making purchase.”
The company founded in 2013 has for far successfully undertaken 18 projects. The hottest product on sale by the investment firm currently is a project named Ngong Blossom.
The project is located 41 kilometers from Nairobi in Ngong. The property divide into 295 one eight acre plots, overlooks Ngong hills and enjoys proximity to the Ngong-Kimuka standard gauge railway station.
Kimani says property around the area has been pricey locking out many prospective buyers.
However the company says its strategy is to target masses making it easier for the company to sell at a bargain. To purchase an eighth of an acre one will have to part with KSh349, 000.
For those looking to pay in installments. The payment plan according to Kimani is flexible and friendly. Minimum bookings for each plot is KSh35,000 with a monthly installment of KSh 25,000 per month over a period of 12 months. All fees are inclusive of legal fees stamp duty and title processing fee.
The company reassure investors of graded access roads, boreholes, an estate gate and a perimeter fence. There are no limits to what structures an investor wants to build, however, the investors are encouraged come together and agree on the kind of structures to be put up.
One of the selling point the company runs with is the ability to deliver title deeds in a period of between four to six months upon completion of payment. The company’s track record speaks for its self says Kimani. Since inception, the company has been able to issue over 4,000 title deeds.
There is also a refund policy in place for buyers who change their mind. According to Kimani, all an investor needs to do is to submit their request to the company and the refund is done within a maximum time of six months.
Other projects the firm has undertaken or currently offering include Tinga suburb where an eighth of an acre goes for KSh179, 000 and the Haven-Konza where an eighth of an acre goes for KSh349,000.
According to Kimani the prices of these projects depend on the location of the piece of land and the available infrastructure such as major highways or projects such as Standard Gauge Railway tend to cost higher.
When selecting a property or where to live, Kimani says millennial place value on different factors. Preserving an established lifestyle is key. “They expect to live near proper facilities, schools and hospitals among others. Real estate, Kimani says can be intimidating for first timers especially with cases of buyers falling in to the hands of scammers. There has been a lot of fraudulent cases reported with investors losing millions.
Data released in 2016, shows that there are over 7000 land fraud cases. The scams according to ministry of lands costs the economy about KSh60 billion.
Among the tricks used by fraudsters include manipulation of illiterate land owners, collusion with government officials and lawyers duping their unsuspecting clients.
Kimani says Username Investment was also a victim in their early years starting out. Together with his co-founders, the young investor’s ignorance saw conned into illegally buying a piece of land. Though they were able to recover a portion of the money were conned, the company says the most important thing was the lesson learnt.
“It’s a different ball game all together now that we are dealing with a huge number of customers. We ensure that we undertake due diligence before we purchase land.”
Due diligence process can be an arduous task. A lot of red tape is involved. The process involves conducting search at the lands registry, ground survey, physical visit to the land, background search of the seller’s identity and dealings. If the seller is a company, buyers should confirm its authority to hold and sell land.
For Username Investment, Kimani says the focus now is offering products out of Nairobi and its environs. Neighboring counties such as Nakuru and Naivasha are among the top of mind destination for the investment company.