Makes sense, if we can keep the costs to the amounts promised. I know a few speculators who are salivating at these prices.

I recall Nyayo highrise was initially promised at 250K and ended up selling for 3 times as much.

@wakanyugi, I'm getting your point on the property cycle theory that boom years in real estate also bring the burst. However the stream of housing stock in 80's/90's was very limited to have any significant impact. The balloting for Buru was massive they had to use a computer to select. Umoja was offered as alternative to Buru with aim of having the allotees put up bungalows. It didn't work as well because the area ended up as high rise development with spillover into Donholm, Tena etc.

In the 80's there was a lot of demand for serviced properties with water,sewer and other amenities like shopping centres which was not met. The effect was the dispersed settlement pattern with homes being built in zimmerman, Githurai, Kawangware, Huruma etc without physical planning. This dispersal was very inefficient in the use of space, infrastructure and resources and largely contributed to depressed period in the 90's. This is what brought the spreading out of the city and matatus which keep following the settlement patterns.

Contrast this with how the Somali community kept to Eastleigh. They didn't spread their resources chasing new places to settle they concentrated on trade and services. The result you have a vibrant local economy and a massive redevelopment with buildings having both commercial and residential functions.

You will not see the economic vibrancy of Eastleigh in the GoK social housing projects. Some of the proposed settlements are far as Mlolongo disconnected and dislocated. The TPA scheme is proper and so too the multi-generation mortgages. Ownership of the units instead of rentals is much more desirable.

What is your ROI, assuming 100% occupancy?
Congratulations on sticking with it to the end!

@Jon gray the investment is in a rural setting hence ROI is unprintable. usability of the property market value as collateral for other investment(s) is key for me

Non issue since it could be a non rental

Accurate. It's not included in valuation but does influence the bank decision on how much to lend. In this case though the individual has other income streams

I would not be overly afraid of buying into a Safaricom Sacco land offering. The brand just would not want to be embroiled in any messy affair, hence relatively solid investments

Of course this is a no-brainer, I was in fact very tempted to go this route because
1. Returns are higher
2. Need for parking and other costly amenities is next to zero
3. Cost of building is cheaper because you can go for the cheapest of the cheap finishings and may not even need to plaster your machine cut walls
4. Economies of scale given low fixed costs compared to returns.
5. Extra income from running businesses at the ground floor

But the reasons why I rejected this route

1. Slummification of entire neighbourhoods (and cities) starts with these buildings. Look at Umoja. Note exactly a great place to raise kids and live a decent life. Some of those apartments are like modern day tombs! Kenyans deserve better. This is why I laud Uhuru's low cost housing agenda. Quality subsidised homes for all.
2. Headaches to the landlord galore. general security issues, Tenant to tenant crime may be rife, eviction problems, blocked drains due to tenants pouring all sorts of plastics and things into the drains, vandalism and constant repairs are no joke. It is as management intensive as it gets and my life is too short to spend all my hours managing all these problems.
3. Cap gains are much lower per annum for these types of structures. What you gain in cash flows you lose big time in cap gains compared to say a guy who buys a 1/4 acre in a leafy area and builds a huge maisonette on it.

Bottom line, I would take decent 2br and 3 br flats, as well as 4+ br maisonettes any day over 1br blocks of flats despite the cash flows. Kenyans, seriously ask yourselves, do we want the whole country to look like this (below). If we are not careful, bila planning, that is the direction we are headed in.



Compare to Enugu (below)in Nigeria. Much more pleasing to the eyes and to the general well being of all tenants :)

Show me bedsitters ANYWHERE in Kenya that come close to matching those huge luxury studio apartments in New York! Some of those things are bigger than a 4 br hapa. Hakuna hata moja hapa Kenya. Those studio apartments (their version of bedsitters) cost hundreds of thousands if not millions of dollars! I am yet to see a decent block of "posh" bedsitters anywhere in Kenya in 99% of all cases. Please prove me wrong. Yet even the stock of those is but a tiny fraction of the entire housing market in New York. Smaller living spaces is just a media catchphrase and fad. Wake me up when it becomes mainstream and actually happens en masse. Saying everybody is running for tiny bedsitters is like saying everyone is rushing to sell their cars to buy those tiny suzukis I see being used for uber chap chap that can almost be held in the palm of one's hand

I do however agree with you that execution (corruption, lack of maintenance, poor management, land grabbing *especially during the man with the rungu's error)*, ignoring zoning laws and outright incompetence) caused the collapse of otherwise well planned estates.

The other problem with catering to the low income segment is that they are not able to afford to live in decent accommodation which is expensive to build, nor maintain it even if they are subsidised into it. Look at Kibera Highrise whose walls are now reddening with mud. In the USA look at Cabrini Green in Chicago - beautiful apartments that had to be torn down when they became crime and drug havens. In Paris pia look at the banlieues - modern urban ghettos with grafitti despite the buildings themselves originally being very decent. Mixed use housing (high end mixed with subsidised low income) seems to have better luck. Whether that can work in Kenya is debatable though.

Ngong Road is littered with the studio highrise apartments. Tembea Kenya! http://www.suraya.co.ke/?property=the-lynx-royal

https://www.the-star.co....-rent-in-ngong-road.html