All investments with good returns involve some level of risk. However, this should not make you shy away from investing in real estate, and especially land. Investing in land is one of the safest investments. 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 your 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.
- Environmental Issues
Weather conditions and patterns change over a period of time. Sometimes, it can be dry for a long period, then later, long rains resume. In a dry season, you may end up purchasing prime land that is located in a 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.
- Zoning Classifications
Every town has a land-use plan that is drawn and implemented 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’t put up commercial facilities and vice versa.
To avoid such a scenario, always inquire about 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.
- Pricing Exploitation
Valuation of land is important when you intend 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 to purchasing overpriced land, conduct thorough research of the average price of land in the area of your interest before purchasing.
- Tenure of Land
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.
- Presence of Fraudsters
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 has existed for a period of time and have delivered Title Deeds to their clients.
Nonetheless, you will need to be smart and real estate savvy in choosing the company you deal with. At Daykio, we are a genuine company that has been in the business since 1984. With our vast knowledge and understanding in the field, we offer affordable land with ready Titles and ensure you don’t lose your hard earned money.
