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Kenyans’ obsession with owning property doesn’t always lead to a handsome reward
Rank: User Joined: 11/10/2010 Posts: 550 Location: Junction
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[quote=jamplu] i came across this in the business daily!! are we obsessed or possessed  http://www.businessdaily...0/-/9xr595/-/index.html[/quote] Land is capital but you need to know how to utilise it for maximum returns. We have always associated land with wealth but that is not true. That is why, an idiot friend of mine claimed one day that he is now richer than me cauze his land has appreciated from 600,000 he bought it at to 2.4 million. I told him, see, I have 2m in cash, will spend it on shares and they will appreciate to 5m in two years. In the next ten years, I will be able to use the dividends to pay for rent and retain the capital which will continue appreciating. I can move from one estate to another, one town to another, one country to another etc on short notice. For my friend, he is tied down by his house, cannot sell in short notice and although the land will appreciate, he cannot use it as cash unless he sells it, a thing he does not intend to do. So, the 2.4m he is quoting should never be a discussion point. Other pple value land as a burial point. Do I care where am buried when am dead? By inference, the man is all that Mr Phantom is not: an untrustworthy radical, divisive, too many enemies, a dictator, and a persistent liar...Gaitho dialogues.
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Kihangeri wrote:[quote=jamplu] i came across this in the business daily!! are we obsessed or possessed http://www.businessdaily...0/-/9xr595/-/index.html[/quote] Land is capital but you need to know how to utilise it for maximum returns. We have always associated land with wealth but that is not true. That is why, an idiot friend of mine claimed one day that he is now richer than me cauze his land has appreciated from 600,000 he bought it at to 2.4 million. I told him, see, I have 2m in cash, will spend it on shares and they will appreciate to 5m in two years. In the next ten years, I will be able to use the dividends to pay for rent and retain the capital which will continue appreciating. I can move from one estate to another, one town to another, one country to another etc on short notice. For my friend, he is tied down by his house, cannot sell in short notice and although the land will appreciate, he cannot use it as cash unless he sells it, a thing he does not intend to do. So, the 2.4m he is quoting should never be a discussion point. Other pple value land as a burial point. Do I care where am buried when am dead? Yup, yup! UTILITY.
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Rank: Elder Joined: 9/15/2006 Posts: 3,905
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And so the article resurfaces...
@Kihangeri interesting...
A Developer is closer to a Trader; both sell underlying asset to realise profit.
A House Owner is closer to a long-term Investor; here you can only compare rental yield v/s dividend yield
So when the chips are down, a Developer and Trader should make more money if they are wiser. The equity Trader is in a naturally cyclical market, and can make more flips. But the Developer deals with assets with much more value, so margins yield much more, perhaps only comparable to a bond Trader.
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Rank: Veteran Joined: 3/25/2010 Posts: 939 Location: Nai
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Kihangeri wrote:[quote=jamplu] i came across this in the business daily!! are we obsessed or possessed http://www.businessdaily...0/-/9xr595/-/index.html[/quote] Land is capital but you need to know how to utilise it for maximum returns. We have always associated land with wealth but that is not true. That is why, an idiot friend of mine claimed one day that he is now richer than me cauze his land has appreciated from 600,000 he bought it at to 2.4 million. I told him, see, I have 2m in cash, will spend it on shares and they will appreciate to 5m in two years. In the next ten years, I will be able to use the dividends to pay for rent and retain the capital which will continue appreciating. I can move from one estate to another, one town to another, one country to another etc on short notice. For my friend, he is tied down by his house, cannot sell in short notice and although the land will appreciate, he cannot use it as cash unless he sells it, a thing he does not intend to do. So, the 2.4m he is quoting should never be a discussion point. Other pple value land as a burial point. Do I care where am buried when am dead? thats one good way to look at it. Personally my concern is with people who are borrowing to buy any piece of land at whatever price and whatever location just cauz their friends own land.
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Rank: Elder Joined: 9/12/2006 Posts: 1,554
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Cde Monomotapa wrote:This mentality is what is going to make us super, super rich via KCB S&L. Roar!! @Cde, i just like the way you look and point at all opportunities to sell KCB 
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Rank: Member Joined: 4/2/2011 Posts: 629 Location: Nai
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This discussion reminds me of the chicken and egg (which came first) debate. While I find many of the arguments ok and logical, I must say that I have comprehensively interrogated my mind, looked at many businesses and products, travelled to various places but come to one conclusion that all wealth comes from the land. Now before someone fires a brickbat at me, I am not suggesting that land is the 'holy grail' that will cure all our problems. However, before the microsofts and Googles of this world earn a coin, someone somewhere tilled, built or mined from the land. The wealth then gained is multiplied into and creates much more value than that which was gained from mining or tilling or building. It is the premise on which the GCC economies, the Brazilian economy, the Asian economy, the SA economy etc are built. To control land at a macro scale has put the Kenyatta family where it is today. I therefore cannot blame a small time Johnny like me who believes that owning a piece of the pie no matter how small (which is also called banking) is ok and to be desired. As for developing that land for sale or whatever, now that is a different discussion. And to make this discussion even more juicy, I leave you with the thought that everything that you do in life is foreplay.
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Rank: Elder Joined: 9/15/2006 Posts: 3,905
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@accelriskconsult, juicy indeed. accelriskconsult wrote:While I find many of the arguments ok and logical, I must say that I have comprehensively interrogated my mind, looked at many businesses and products, travelled to various places but come to one conclusion that all wealth comes from the land. But some would argue, all wealth comes from knowledge. Without knowledge, one would not even begin looking at land and how to use it. Hence why all super-powers led in a technological era: be it renaissance, agricultural, industrial, atomic etc. And that is why small time Johnny, after taking his piece of the pie, mostly remains small time. accelriskconsult wrote:To control land at a macro scale has put the Kenyatta family where it is today. PS: Really really struggle with your Kenyatta family example. Do they extol virtue, industry, or grand acquistiveness?
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Rank: Member Joined: 4/2/2011 Posts: 629 Location: Nai
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muganda wrote:@accelriskconsult, juicy indeed. accelriskconsult wrote:While I find many of the arguments ok and logical, I must say that I have comprehensively interrogated my mind, looked at many businesses and products, travelled to various places but come to one conclusion that all wealth comes from the land. But some would argue, all wealth comes from knowledge. Without knowledge, one would not even begin looking at land and how to use it. Hence why all super-powers led in a technological era: be it renaissance, agricultural, industrial, atomic etc. And that is why small time Johnny, after taking his piece of the pie, mostly remains small time. accelriskconsult wrote:To control land at a macro scale has put the Kenyatta family where it is today. PS: Really really struggle with your Kenyatta family example. Do they extol virtue, industry, or grand acquistiveness? Muganda, I agree with you on both counts but only to some extent, that is why I pointed out to the egg - chicken riddle; It would appear that land even when exploited in ignorance (think charcoal, irresponsible mining) does produce wealth and therefore is the source of wealth. I suppose that you will counter that you have to know how to mine to get this wealth. I would propose rephrasing to state that knowledge is the source of sustainable wealth/development. On the second count, I did hesitate using the Kenyatta family as examples for the very reasons that you advanced but the moral horse quickly bolted from its stable in my mind. I tried to get examples that Wazuans could identify with but Rockefeller was too far while Criticos would elicit similar criticisms. I am all for ethical and sustainable approaches to wealth creations and therefore I am with you on that score.
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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Jamani wrote:Cde Monomotapa wrote:This mentality is what is going to make us super, super rich via KCB S&L. Roar!! @Cde, i just like the way you look and point at all opportunities to sell KCB Ofcourse, the time to sell will come when demand and supply of housing nears. From low income to high income segments. Let the economy keep churning out more middle class  and pple who do things coz others are doing it.
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Rank: Chief Joined: 1/13/2011 Posts: 5,964
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NB: Levi of Levi's jeans made more money selling denim to prospecters during the gold rush than the miners. In this case, I am interested in selling finance
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Rank: Member Joined: 2/25/2010 Posts: 158
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fantony wrote:if she knew that most people have to subsidise a mortgage payment after getting rent from their pockets we would be in bigger problems...
can i tell the buru buru story again?
Yes please, tell the buru story again for those of us who have never heard of it. Thank you. Keeping it all in the family
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Kenyans’ obsession with owning property doesn’t always lead to a handsome reward
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