Syovata Ndambuki

Property investments tend to be capital intensive and that comes with high risks. Where high risk is involved, there is potential for huge losses. As a beginner in the property world, your first property does not need to be the perfect dream home or a major income earner. It is always advisable to start small and start as early as possible.
The best first-time property investments should be low risk assets- meaning they are not as expensive and if you were to make a mistake, it wouldn’t lead to a big loss. Low risk investments help you learn the ropes and as you build your risk appetite. Here, we break down three perfect investment for first time property buyers in Kenya.

Studio Apartment Unit

In the last couple of years, small apartment units have short to stardom. More and more investors are putting their money into studio and one bedroom units due to their ability to attract tenants fast and earn rental income. Subsequently, more developers are working hard to meet this growing demand. Studio units are a great first time investment as they help you “get your foot into the property market”. They are not perfect when you live in them but they are affordable.

In 2024, you can find studios for less than 2 million in decent locations. It is easier to raise the deposit amount (normally 10%) and if you were to buy through credit, the interest on such a loan amount would not be too expensive or scary. The risk is also much lower and if you were to make mistakes in your purchase (e.g, buying the wrong location, getting an expensive loan etc.), you’d recover much faster, compared to high cost properties.
If you decided to rent out your studio, the price you pay to learn how the rental market works is much lower compared to someone who builds an entire block of rental units only to realize they made a mistake. With a studio, you’ll learn what it takes to attract a tenant, how to keep one, maintaining high occupancy rates, pricing, and other opportunities within the rental sector.
In simple terms, a studio unit will help you build your property portfolio as its value increase gradually and it will help you understand how real estate works.

Moveable Housing Units

The cost of a 40 foot container in Kenya is about Kshs, 500,000. This is not inclusive of refurbishment and transport costs. While that amount might seem high on a surface level, think about all the things you can do with such a unit. Used shipping container units present a lot of opportunities for real estate investors. It could work as a storage unit on an empty piece of land that awaits construction. That same unit can be transformed into a transitional one-bedroom house as you build your future dream home. And once you’re done building, you one-bedroom container house can be transformed into a rental unit or a business space.
But the cherry on top of container units is that they are moveable. If you started off on leased land and bought your parcel later, you can move with it. If you decided to sell it off or move to a different location, transport can be arranged. Talk about value for money.

Besides container housing, there are other types of moveable units such as modular housing and prefabricated steel buildings. You could also get creative and come up with a unique design for a mobile unit. It could be a commercial or residential unit, but as long as it’s moveable, it’s a good investment.

Low Cost Land

Over the last couple of years, there has been a declining interest in speculative land buying in Kenya. Previously, cheap land was seen as the gateway to unimaginable riches. It was known to turn many into overnight millionaires when a new road or major infrastructure was developed in the most unexpected places. But with time, people are realizing that exiting the real estate market (reselling property) is not that easy. Besides, land locks up one’s money into an immovable asset and possibly making them cash poor and asset rich.
But this very, disadvantage of low cost land might also be the reason to invest in such as a beginner. This is mostly applicable for people in their early years as they have time on their side. Low cost land is perfect if you are not in a hurry to develop it.
It helps you preserve your net worth as opposed to holding your money in a bank account. Think of it this way, if you had money you were not using for a long time, in the event of high inflation, your money loses value. But if it is locked in a low cost land somewhere, it will be gaining value with time.
Low cost land is also low risk, an important factor in Kenya’s real estate market. There are way too many scammers and a beginner may not know how to smell a scam from a mile away. If lets says, (God forbid), you were to be scammed during your first land transaction, the risk would be much lower if you were investing in a low cost property. Besides, you would learn a lot from the experience.
Lastly, low cost land gives you time to think about what exactly you want. Your ultimate dream home isn’t always clear and sometimes the location you want might turn out to be less desirable over time. As a speculative buyer, you will have enough time to analyze the location and decide what you want to do with your land in the long run.