Even though the COVID 19 Pandemic has ravage the economy, there is a positive growth in real estate sector especially amongst the low and mid-class people. This is contributed by many factors that influence the positive uptake of the real estate products.
Unlike other classes, low income owners are now focusing in owing plots and lands to build their residential homes. Despite the hike in price in most parts of the country, in real estate, they are committed in savings their hard earned money in order to invest in places that is affordable and within the city.
Let’s look into factors that drive people to invest and how they make it happen. First, let’s look at the factors that contributes positively especially during this hard times of the economy.
- Government interventions
Government policies have been favoring the growth or real estate. In terms of taxations, documents like title deeds have easy processing unlike before and general recovery of economy have results in more participants getting into the markets.
- Entry of Fresh real estate companies in the market
Real estate companies have played a key role in shaping the performance of real estate in the economy and has assisted the low income earners in the pyramid to purchase land with flexible terms.
An example of a real estate company that has done exemplary work in real estate in Kenya is username Investment limited. They have flexible payments plans for all their customers and their real estate properties on sale are in strategic locations with affordable prices. Ideal for both residential and speculations.
Reason for investing for mid-class people
Buy to build
First, majority of the people who buy residential plots are intending to build homes and settle there. Often they consider properties that are within suburb of a city. They prefer such locations because that they will be able to access the city easily.
In addiction properties within the outskirt of the city access good infrastructure, access to good social facilities that will make their lives better without further spending further rent.
Buy to hold
Another group of individuals buy land and wait for prices to appreciate for them to develop and rent it or sell. This case scenario is more common in places that are enjoying major development in terms of infrastructure.
Land is an appreciating asset. The appreciation rate only varies among regions. There are few cases when the property is bought and failed to appreciate.
Most of the people who often buy and hold, then to be doing investments for long term and while they are waiting for better prices, they often lease for short term gains.
In conclusion, consumption of real estate properties among low income earners has grown in recent years due to favorable environment create by the government and key plays in the industry. This is expected going forward.