How to successfully invest in land in Kenya

“Today people who hold cash equivalents feel comfortable. They shouldn't. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value.” Warren Buffett.

Factors to consider when identifying the best place to invest in land;

Infrastructural growth

Infrastructure development is the construction and improvement of foundational services with the goal of sparking economic growth and improvement in the quality of life. When identifying a place to invest in, consider an area that has upcoming development projects such as dual carriages, bypasses, airports, SGR stations, dry ports and the potential of establishment and expansion of industries. This will ensure you purchase a property that has the potential for growth that will translate to appreciation in the value of your property.

Areas such as Konza, Ngong, Nakuru, and Naivasha have mega infrastructural project coming up i.e. Konza City, The Greater Southern Bypass, The Standard Gauge Railway passenger station, dualing of the Nairobi-Nakuru Highway and upcoming Naivasha Dry Port. These developments will see the prices of land in this areas increase and an investor will realize the value of the money he/she invested.

Land appreciation rates

A great resource in this area is The County Land Prizes Report released in April this year. It identifies counties that have the highest land appreciation rate in Kenya. For example, Nakuru County saw its land prices rise by an average of 12.7 percent in 2017 and area such as Ngong registered the strongest growth in satellite towns for both property and apartment prices in the first quarter at 3.7% and 2.8% respectively. This is what a potential investor should look for especially the ones purchasing property for speculation. This will give them a guarantee of the percentage appreciation in their land and give a rough figure of how much a property can be resold in future.

Population growth

Population growth within an area means more people will need rental homes as they run their businesses and go to work. Purchasing land and planning to venture in construction in such areas will see investors realize returns in their investment. Population growth is also a factor that is considered when the government is planning on expanding towns to cities. This gives a potential investor the assurance that their property will reap maximum benefit in the near future after investing.

Personal investment goals

The long-term goal of an individual determines where they will purchase land for their individual purposes. A person who aims at building a holiday home, a business to cater for tourists and investing in agriculture will consider places such as Naivasha, Nakuru and Ngong. When considering where to invest an evaluation of personal investment goals is key in helping identify the best place to invest in.

How to successfully identify an area with the above characteristics

1. Request for proposed bypass maps from your preferred real estate company- this will help you identify where the government is planning to have the construction of bypasses and you may consider investing in such areas.
2. Be informed on the land appreciation rates in the different areas you prefer investing in- this is possible through following your investment company social media pages that will often give updates on the land prizes in different areas.
3. Infrastructural news from the national government will also ensure you are knowledgeable of the proposed mega infrastructural projects such as Konza City and Standard Gauge Railway Line
4. KeNHA beacons- The Kenya National Highways Authority have beaconed majority of the roads to be tarmacked and dualled such as Ngong-Kibiko- Suswa and The Nairobi- Nakuru- Highway this will help any potential investor identify future road expansion.
5. Population data- The Kenya Bureau of Statistics is in the forefront in providing population updates at national and county level, this is helpful to an investor who is looking to invest in an area that has rapid population growth.