Written by Reuben Kimani, CEO, Username Investment Limited.
Over three million Kenyans live in diaspora, by August 2017 their remittance stood at Kshs 166.4 billion according to data from Central Bank of Kenya. Generally, its considered that this population is well-educated with the majority living in Europe and the US. The remittance was only made through formal channels such as commercial banks and authorized international remittance providers; these did not include informal means. The transfers make the country’s largest source of foreign exchange earnings.
Most of the funds are sent to relatives with real estate, food, education, health consuming the lion’s share. For real estate the monies are sent to invest in land that can be turned into a home upon retirement. However, this has turned out to be a disappointment to many who send money to friends and relatives only to realize the funds were diverted for personal gains. Below are tips to follow when investing and avoid being conned by friends and relatives because the biggest mistake a person in diaspora can make is failing to invest when property prices are affordable and available back home.
- Contact a reputable real estate firm directly
The world is now a global village and information is readily available on social media, blogs and websites. Look through the various websites and social media pages and give more attention to the feedback given by clients. This is easily available on the review section; you can also obtain testimonials from clients who have done business with the companies. When navigating through the information look out for the projects they have done and the actual number of title deeds issued. The more a company issues title deeds the better because the success of any real estate company is delivery of title deeds. Look out for award winning companies and subscribe to receive updates of their projects. This will save you the trouble of blaming lack of opportunity and information about credible real estate companies back home.
- Cross check details before striking the deal
The inability to safely and conveniently transact and close a deal through a trusted representative is one of the major causes of diaspora clients fearing to invest in their home country. Always seek to ascertain the information given on the website by contacting a relationship manager in your select real estate, you can afterwards proceed to do online purchase on the website and make direct payments to the company without a third party. Read through the terms, conditions and policies around the purchase process to ensure you are well informed before making the final purchase decision.
- Avoid companies that inflate prize when they realize they are selling to a diaspora client
You may navigate through a company’s website and identify a project of your interest but when you contact a relative or a real estate company you are informed of a different price. The difference may come as a collusion between your relatives with the real estate company, this is a red flag that might turn out to a fraud. Always stick to a company that has an online purchase system that does not change the pricing and allows you to make a direct transaction without extra charge for being a diaspora client.
- Allow your relatives and friends play a supervisory role but not decide for you
Many of the clients who have fallen victims of diverted cash by relative’s blame lack of credible parties to represent their interests. After conducting intensive research and settling on your preferred investment company, ensure you reach out to a relationship manager who will share first-hand information with you. This includes the project location, value adds and prices of the property. You may allow your friends attend site visits and open days but ensure you have direct contact with the investment company from where you can deposit your payment and receive scanned receipts and your friend takes the hard copy. Request for the projects layouts and select your preferred plot and seek advice both from the real estate and family member. Create a balance between the two and ensure you are the final decision maker.
- Do not over rely on internet information
You may information on the internet is known for portraying negative information about African countries, take caution and do not over rely on the negativity. Information provided by them may discourage you from investing in your home country for fear of lack of attractive returns yet they will themselves invest in projects in the same country. Always seek to obtain information from real estate companies and compare the percentage returns of real estate with annual growth reports on your home country.
- Ensure you sign the legal documents and receive your title deed personally
Land transfer is a process that is regulated by the law, ensure you fill in an offer letter, sign sale agreements and land transfer forms. These documents can be shared to you directly on email for signing, this ensures the process you have undertaken is within the law. The availability of international courier services also provides you with the opportunity to personally receive your title deed.
