Common Mistakes First-Time Home Buyers Make

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    File image of residential houses
  • First-time investors with a frugal budget always debate whether to buy a readily built house or land.

    For a majority, purchasing a home is always a dream, but the process is quite tedious and a majority make costly mistakes. 

    Prior to making an investment, the budget should be given the top priority.

    Poor Planning 

    File image of Kenyan bank notes
    File image of Kenyan bank notes

    One ought to first decide whether they are buying the house and how much the price cuts into the budget. 

    This is where one chooses between a want and a need.

    Here, the home buyer also fails to go house hunting and relies on the word of the real estate agent, some of whom tend to be unscrupulous.

    Also, make sure to inspect a house and find an appraisal. 

    Capital and Budget 

    Homebuyers are advised to first find a financial expert to advise on the best source of money for buying a house or investing. 

    Most ignore such advice and plunge into loans without stable income to service them or end up listing the same property as collateral, which they end up losing. 

    Shylocks tend to seize up such opportunities and offer quick cash while eying the property. 

    The other common mistake is outspending the budget, and overlooking mortgage plans.

    However, some mortgages are heavy to shoulder. 

    Failing to save for a down payment is also one mistake first-time homebuyers make. 

    A section of Ngong Road
    A section of Ngong Road

    Purchasing a house while servicing debt

    Plunging yourself to more debts can spiral the situation out of control.

    Homebuyers tend to rush, seek quick cash and fail to service loans hence more defaults. 


    Experts warn that most homebuyers rush to buy any house that hits the market. However, those who choose the best location will hold the most valuable property. 

    Best locations include areas that have the key infrastructure, where land appreciates, thus property depreciates at a much slower rate.

    Nonetheless, it is also advisable to buy land rather than a house when the opportunity arises. 

    Land prices keep soaring and the Hass Consult property index for Q1 2022 indicated that land and rental prices increased in major Nairobi satellite estates.

    “Buying a vacant plot since many ready-made houses are more costly. Vacant plots are also ideal for seasoned investors in real estate who want to diversify their property portfolios by purchasing and constructing more commercial or residential units.

    “Buying a plot – especially in the outskirts of Nairobi – is more cost-effective and gives you time to build later when ready with finances,” Harold Ayodo, an Advocate of the High Court of Kenya and land expert, says. 

    He adds that houses are harder to maintain as compared to houses, as it does not involve plans for renovations and mowing the lawns. 

    “Financially, the payment of relevant property taxes is lower on vacant land compared to when buying a house,” he wrote in an article in a local daily. 

    Jean Folger, a seasoned financial writer covering real estate adds that although building a new home doesn't offer the same convenience as buying an existing house, the big advantage is you are much more likely to get exactly what you want.

    “You can create a more efficient home that meets new energy codes and standards for heating, ventilation, and cooling, plus insulation, and air filtration. Better efficiency is good for the environment and can save you money on your utility bills each month.” 

    Traffic on a section Of Thika Super Highway as seen on November 11, 2019.
    Traffic on a section Of Thika Super Highway as seen on November 11, 2019.

    Gladys Situma, Branch Manager at Fanaka Real Estate, concurred and told “One of the advantages one gets from buying land and building a house is that you get to design that particular house that you want and how it should look like and as they say, it is always in the details. 

    “However, when you opt to buy an already built house, you will have to settle with the design that is available on the market.”

    The majority of home and land buyers are rushing toward satellite areas as mentioned by the Hass Consult property index for Q1 2022.

    Land in Kitengela, Kiserian, Athi River, Upper Hill, Muthaiga, Langata, Juja, and Kenyatta Road increased. 

    "Ruaka enjoys easy access to the city's more affluent suburbs, rendering high land values that can only be absorbed on high-density apartment developments.  

    “It has, therefore, become the largest stockholder of apartments within the satellite as it presents the ability for the working population to enjoy both housing affordability and reduced transportation costs," stated Sakina Hassanali, Head of Development Consulting and Research at HassConsult. 

    Situma added that they have also witnessed growth in Kenyatta Road which is booming due to the accessibility by the Northern and Western bypasses and the Thika Superhighway. 

    Hass Consult noted that the price of an acre of land rose between 4.86 per cent to over 16 per cent in satellite areas.