Sharp Daily
No Result
View All Result
Sunday, June 1, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home Real Estate

The pros and cons of off-plan property investments

Brian Omondi by Brian Omondi
June 10, 2024
in Real Estate
Reading Time: 2 mins read

Off-plan investments refer to purchasing of property before it is fully constructed. This can be during the planning stages or in the early construction stages.  This method of financing is beneficial to both the investor and the developer. The investor gets high returns while the developer gets the financing needed for the project.

Some of the advantages of off plan investing include;

  • Lower purchase price

Developers offer the properties to the investors at a price lower than the market price. This is done to ensure that the project secures buyers as soon as possible. 

  • Flexible payment plans

Most developers offer flexible payment options such as instalments and mortgages. This means that the investors can opt for plans that best suit their abilities. 

RELATEDPOSTS

Unlocking Kenya’s real estate potential through public-private partnerships

February 28, 2025

Opinion: Investing in short-stay & airbnb rentals in Kenya

February 18, 2025
  • Capital growth 

As the construction progresses, the property value typically increases. This means that investors who purchase off-plan benefit from substantial capital growth.

  • Customization options

The buyer has the option of selecting locations, layouts and finishes according to their preferences allowing them to customize the property to meet their needs. 

Despite these advantages, off-plan investments can have the following disadvantages.

  • The risk of project delays 

Construction projects can sometimes delay due to factors such as financing issues, bad weather or legal compliance issues. These delays can impact the expected timelines for property appreciation affecting the buyers’ financial plans. 

  • Market fluctuations 

Real estate markets can be volatile, and the value of property upon completion may not always meet the expectations. This was experienced during the COVID-19 pandemic where the effective demand for real estate products dropped unexpectedly hence the value of properties lowered.  Real estate firm Erdermann properties limited had a Ksh 7 billion project that was affected by the pandemic. The project failed due to financial constraints arising due to the hard economic times during and post COVID 19. There was poor uptake to fund the project and it was halted.

  • Potential for disputes 

The payment terms may be a cause of disputes between the developers and the investors if the options available are unfavourable. Disputes may also arise due to contractual issues such as ambiguity in the contracts. 

  • Failure to deliver

A developer may fail to deliver due to financial constraints when the target market fails to take up the properties or in some occasions due to fraudulent cases.  Therefore, investors should do their due diligence to ensure the credibility of the developers.

Previous Post

Uhuru’s office alleges denial of state benefits, mistreatment

Next Post

Government slams Uhuru Kenyatta over benefit demands

Brian Omondi

Brian Omondi

Related Posts

Real Estate

Restructure housing levy to solve Kenya’s housing crisis

May 23, 2025
Real Estate

Navigating the fallout of foreign aid reductions

May 20, 2025
International

Knight Frank; Kenya’s wealthy are trading mansions for market moves

May 16, 2025
Real Estate

Nairobi real estate divide

May 15, 2025
Real Estate

A KES 6.4 million real estate heartbreak in Syokimau

May 12, 2025
Real Estate

Hass property index: Kenya’s real estate market rebounding

May 6, 2025

LATEST STORIES

Best investments for Kenyan seniors: Secure, predictable & low-risk

May 30, 2025

Why June is the Secret Sweet Spot for Travel

May 30, 2025

Strategies to elevate more women to corporate leadership

May 30, 2025

Tap on Kenya’s 2025 tech revolution

May 30, 2025

How CURBS supports employers and employees

May 30, 2025

NSE deserves more attention from young investors

May 29, 2025

The silent strain of remote work on Kenya’s urban workforce

May 29, 2025

How Kenya’s crypto bill could reshape the digital economy

May 29, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024