When looking for a house, don’t focus solely on price

Thursday December 7 2017

Many houses put up for sale target a certain class of people; it is better to buy a house that is a few years old rather than a newly built one whose safety standards you cannot be sure of. PHOTO | DENIS OKEYO | NATION MEDIA GROUP

Many houses put up for sale target a certain class of people; it is better to buy a house that is a few years old rather than a newly built one whose safety standards you cannot be sure of. PHOTO | DENIS OKEYO | NATION MEDIA GROUP 

By PAUL KARIUKI
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Two years ago, John Njenga came across an advert for a house for sale online.

Although the Nakuru resident had no immediate plans of buying a house, it seemed like a good deal: with a sacco loan and his savings, he could be a proud home owner. And since the price was negotiable, he was sure he would get a good bargain.

But when he took an expert to help him assess the property, he changed his mind. Although the price was “fair”, the house needed many renovations. “This convinced me the deal was not worth it, so I began looking for another house,” he says.

While he would have derived more satisfaction from building his own home, it would have been more costly, hence the “cheaper” option of buying instead. Njenga’s case shows that the glossy pictures of houses for sale online can end up costing one dearly.

When the seller is willing to negotiate the price downwards, be wary because it could be that he built cheaply, and that the price quoted is not a true reflection of the property’s value. Besides, it is a pointer to a building that will requires renovations, which adds to the cost.

So, while the convenient location and cost might favour you as the buyer, you should brace yourself for disappointment. For instance, the property might not meet your specifications, or it might be of low quality.

Mr Daniel Maigwa, a housing expert and interior designer, says while building your own house can take more time than buying one since costs might exceed your budget from time to time, it is preferable because you can have everything built to your specifications.

Besides, he adds, the drawbacks to buying are numerous. For one, the location might be a problem. “It might be in an a posh location, with high monthly bills for the attendant services,” he says, adding, “It is better to look for a house you can afford, and which has all the features you are looking for,” he says.

He suggests that buyers engage experts for advise. For instance, the price might be inflated

LAWYER PRESENT

Ms May Wangari, a land broker and real estate agent, agrees, adding that a lawyer’s presence is particularly important in any financial transaction. However, she adds that if you are not satisfied with what’s on offer, look for another house.

Engaging an agent to negotiate on your behalf might be advantageous since they know the market better, but letting the agent pressure you to buy the house might work against you, she cautions.

Ms Wangari advises against putting too much trust in an agent, unless you know them really well.

She also cautions against rushing a purchase saying: “It’s better to bide your time instead of trying to beat other interested buyers. You might end up burning your fingers,” she says.

She advises that you buy a house you can comfortably afford, and cautions against becoming complacent in a house that you have not fully paid for.

Citing the case of a customer who bought a house in a good location using a sacco loan but who was not happy because he had two debts that took long to service, she adds, “Defaulting on a loan can lose you that house. The same is true in case of foreclosure if you buy using mortgage,” she says.

She notes many houses put up for sale target a certain class of people, adding that it is better to buy a house that is a few years old rather than a newly built one whose safety standards you cannot be sure of.

The safest bet is getting a house that meets your specifications, is affordable and does not come with hidden costs. “What you need at the end of the day is an investment that will satisfies you, and not a thing that drains you financially through constant maintenance,” she says.