A real estate investment in Kenya can cost as little as KES 50,000 or as high as over 100M depending on its location, type of property, and the availability of a financing plan. Whether you’re considering a holiday apartment in Diani or eyeing a piece of land in the outskirts of Nairobi, understanding the cost implications will help you make an informed financial plan.

This article breaks down key factors that influence how much you need for a real estate investment and how Pettmall Shelters can help you take the first step.

Questions to Determine How Much You Need to Start Investing in Real Estate

Real estate investment capital amounts depend on a few key factors. These not only influence your capital but also your real estate returns in the long run.

What Type of Real Estate Investment Are You Interested In?

Real Estate Investment Trusts (REITs) require the least amount to get started. They involve buying equity shares for a real estate asset and earning dividends from its income and value appreciation.

Buying a residential apartment is cheaper than investing in land, especially in urban areas. For example, a 2-bedroom apartment ranges from KES 10 to 40 million in Westlands, Nairobi, while a quarter acre of land in the same area is above KES 100 million.

Commercial real estate requires an even higher capital because they’re often located in business hubs with expected high yields.

Do You Have a Financing Plan?

A financing plan for your real estate investment in Kenya lowers your starting capital. It gives you breathing room for a property to begin generating income and cover its cost. However, you must have a positive credit score and a collateral asset to secure most types of financing.

Examples of payment plans available in the Kenyan real estate market include:

Bank loans
Lipa pole pole or instalment plans
Mortgage financing
Off-plan payments
Developer financing

Where’s Your Dream Real Estate Investment Located?

Properties in urban areas ask for higher prices than rural regions because of a high demand and limited availability. Investments in satellite or emerging towns may require more than in remote towns, but a steady value growth and high returns are expected over time.

For instance, a one-bedroom apartment in Syokimau costs KES 2M to 5M while the same apartment in Gigiri requires above KES 5M.

Areas with developed infrastructure and amenities also have a larger capital compared to those without due to demand and convenience. Proximity to these utilities, such as roads, railway lines, schools, electricity lines, and internet connection further raises property value.

What Are Your Real Estate Investment Goals?

Are you looking for high or low-risk investments? What are your expected returns? How long do you have to actualize your target?

Some people invest in real estate for quick cash flow while others want to build a home and save on rental costs. High-risk properties often require more to invest but their returns are equally high. Long-term real estate goals, such as legacy planning and appreciation, can be relatively cheaper with steady cashflow.

There Are Additional Costs Beyond the Purchase Price

The amount you need to invest in real estate also includes costs incurred to facilitate the sale, from property search to deal closure. Putting these fees into account gives you a more realistic figure to make an informed decision.

Additional real estate investment costs to consider are:

Legal fees
Stamp duty fees
Repair costs
Survey fees
Transfer of ownership
Title search fee
Property valuation fees

Some fees, such as stamp duty and property search are fixed while others may depend on location and the experts you work with.

Investing in Pettmall Shelters’ Plots for Sale

Pettmall Shelters has affordable one-eight acre plots for sale in Kikuyu and its environs ranging from KES 350k to 2.2 M. Our projects are in prime and fast-growing locations, have ready title deeds, and offer flexible payment plans to help more Kenyans own land.

A few of our real estate investments are:

Neema Phase 5 in Lusigetti Kikuyu for KES 850k
Nawiri Gardens Phase 10 in Nachu Kikuyu for KES 350k
Prosperity Gardens in Thigio Kikuyu for KES 2.2m
Nachu Crest Phase 3 in Lusigetti Kikuyu for KES 350k
Tulivu Gardens near Mi Mahiu town for KES 400k

Call Pettmall Shelters at +254-726 333 222 or schedule a free site visit to any of our properties to learn real estate investing in Kenya.