TOP Things to Consider When Buying or Renting Property in Kenya
Finding the perfect home can impact almost every aspect of your life. Now, imagine that you’re about to move abroad to Kenya, a country whose language, culture, and real estate market is foreign to you. The task of looking for a new home just became ten times more challenging.
Where to live? What are the rental prices and conditions? Is buying property a better investment than renting? And, more simply, where should I start my search for a new home in Kenya?
These are probably just some of the questions that rush through your head as you’re preparing to leave everything behind and relocate to one of the most vibrant and booming economies in Africa.
This article will teach you everything you need to consider when looking to buy or rent property in Kenya.
Rent vs. Buy: Which Option is Best?
One of the first decisions you’ll need to make is whether you should rent or buy property in Kenya. While numerous signs are pointing to the fact that 2017 is a homebuyer’s market and the trend is expected to continue in the following years, renting might be a safer investment for expats.
Here’s why:
Renting offers enough flexibility in case the house doesn’t meet your expectations. It’s also an excellent way to gain more knowledge regarding the region and whether you truly want to make a long-term commitment there. For example, you could hire a tutor, learn the Swahili language and the customs, and increase your chances of negotiating a better deal for yourself.
Tips for Buying Property in Kenya
If you’ve decided that buying a home overseas is a wise investment, then you need to think carefully about the location that you want to live in – consider factors such as your place of work, distance to the city’s entertainment hubs, and so on.
Another factor that you should pay special attention to is the real estate agency you will hire for this job. According to Tuko, Kenya’s capital city might be a real estate bubble just waiting to burst, so there probably are numerous realtors who are looking to make a quick buck on the account of uninformed buyers.
Get familiar with the fees involved when buying a property in Kenya. One of the biggest costs is stamp duty, which represents about 4% of the purchase price.
Keep in mind that most sellers draft the contract in such a way that you’ll have to pay the lawyer’s fees, which represents about 1.25% of the purchase price. So, take this cost into consideration as well.
As far as getting a mortgage, most experts would advise you to avoid it, considering that the interest rates are pretty high. That’s the reason why, in 2015, there were fewer than 50,000 mortgages in Kenya. However, the costs tend to be less than rent in a Western country. Therefore, it might be an attractive option for future expats.
Renting a Home in Kenya
If you decided that renting property in Kenya is a more suitable option for your needs, then the first thing you need to do is clarify the requirements for your living space. Do you want to live alone or share an apartment with someone? Are the neighbourhood safe and the transportation infrastructure reliable? Is the real estate agent willing to negotiate a tenancy contract of three months or less?
These are some of the first questions that you need to consider.
Then, you need to decide how much money you can afford to pay for an apartment. As a rule of thumb, try to set aside about 30% of your monthly income for rent. If the realtor asks you for more, then you should continue your research.
Read the leasing contract carefully before signing it. Review the terms and conditions you’ve negotiated with the agent. Don’t be afraid to ask for clarifications if you notice a vague term or phrase.
It’s not uncommon for expats to get terrified by the idea of buying or renting property in a foreign country. Join forums and find out firsthand other people’s experiences moving abroad to Kenya. Becoming an expat is gaining in popularity, so there will probably be numerous people who have gone through the same struggles and can lend you a helping hand. Also, it’s not a bad idea to make some meaningful connections before you relocate.
