By Patricia Mwikali
“Ninety percent of all millionaires become so through owning real estate. More money has been made in real estate than in all industrial investments combined. The wise young man or wage earner of today invests his money in real estate.” – Andrew Carnegie, billionaire industrialist
Investing in real estate is a dream that majority of Kenyans, and indeed most in the world have. This is so because real estate investment, as per the above quote from Carnegie, is an industry that has made many people millionaires due to the fact that return on investment is almost guaranteed. This type of investment is also seen as a status symbol, especially in a county like Kenya, and most of the developing world.
It therefore goes without saying that a great deal of money, time and personal effort is involved in the search for the right property to invest in; property that is suitable for the needs of the person investing and that is within their budget.
This therefore calls for a great deal of deliberate effort on the party seeking to invest in real estate to ensure that they have worked with the right people so as to achieve the desired end result – which is to get the desired property in the right location and within budget in a timely manner.
In Kenya for instance, the right person for this type of business is someone who has the right competencies in terms of knowing the procedure of acquiring property, the laws involved, offices to visit, and has most importantly been registered by the Estate Agents Registration Board (EARB) to carry out real estate consultancy business. It is a requirement for such a person to have an office from where they operate from. This is important so that clients and other interested parties, such as regulatory people among others have a place to go in case, they need some help or to follow up some matter.
It is an open secret that some investors have in the past, and even now , continue to use the services of people who pose as experts in this field, get conned and all of a sudden they don’t have anywhere to follow up because the person they were dealing with doesn’t have a physical office. Or rather a permanent address where they conduct official business from.
Furthermore, a person who has been duly registered to operate real estate constancy business has already been evaluated by the board on several areas, which include among others competency, honest and sense of responsibility required to operate in that field. One can say that it is easier and wise to deal with such a person because they have their professional conduct on the line should something go wrong, especially something that negatively will impact their profession.
It is also advisable to engage an agent that is well versed with the area you want to invest in. The beauty about this is that the investor will benefit from the agent’s intimate knowledge about the area in terms of the appropriate price for the concerned property, recent trends in the area, prospective/planned developments that are likely to come up in the area, whether the need for which you need the property is appropriate in that locality or can be met elsewhere, disputed properties among other things that you might not be privy to but which will either make your investment worthwhile or counterproductive, or lead you to lose your money altogether. As such, a local agent will be able to provide above board and relevant advice to the client.
From the foregoing, what comes out is the need to use the right people as defined above so as to avoid being duped. This does not mean that using the right people will completely take away the possibility of something going wrong. What it means is that in the case of anything going wrong, the investor is likely to get recourse if they used a registered person as opposed to when they used a random broker who has vanished into thin air.
Therefore, do not fall into the trap of sweet-talking brokers who are keen on your hard-earned money without caring about your interests. A registered agent is unlikely to hike the price of a property because in most cases they advise the investor from a professional standpoint, namely to secure a valuation report and use it as a basis for negotiations.
Lastly, as Tamir Sapir asks that “If you’re not going to put money in real estate, where else?” You should endeavor to invest in real estate , but use the services of diligent and registered agent, who will most likely have your best interests at heart. This is what will guarantee you a good deal, and at the same time build a long-lasting professional relationship!