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WHAT ARE PRO AND CONS OF PURCHASING PROPERTY OFF-PLAN IN KENYA?

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Fig. 1 showing photography of off-plan property in Kenya


In Real Estate, off plan purchase is referred to as buying a property that is still under development process or rather it is yet to be completed.  In Kenya, there are various factors that motivate purchase in off plan. These factors include; good payment plan, reputable developer, substantial savings, ability to give input on a show-house and lastly good negotiation power especially while paying in many units. Off plan purchase here in Kenya comes with its pros and cons. They include;

Pros of off plan purchase of Property in Real estate.

What are these pros (advantages) of off plan purchase in Real estate?

1. You are locked in a price which saves you in any future market trends.

Purchasing your property off the plan allows you to lock in the price and saves you from any future market trends that may see the rest of the houses in the area go up in price. Even if your property’s value goes up, you will not need to pay extra. You can then invest in another property and continue growing your property portfolio.

2. Stamp duty concession.

One of the advantages of buying property off the plan is that it saves money that could be used on stamp duty since most Real estate companies offer greater discounts on newly constructed property.

3. Gives buyers more time to plan themselves.

Property buyers are generally needed to put down 10% discount to secure the contract and can use the extended construction time to save up the outstanding balance thus purchasing property off the plan offers property buyers enough time to get their finances in order.

4. Property buyer gets to choose what to change while construction is still ongoing.

Buying off the plan gives you the chance to get to choose what you want changed or improved as long as it is within the set price. Since most people wait for fully constructed houses to buy, buying yours off the plan allows you to choose the best location and the one you believe is ideal for you.


What about the cons of purchasing property off the plan in Real estate? What are they?

As much as off plan purchase has its advantages, on the contrary, it also comes with its risks. These are;

1. Vulnerabilities of deposit.

In a scenario where you end up not being able to get a further mortgage agreement in place after payment of deposit and you fail to pay for the balance, you could lose your deposit altogether. Do you have a choice?  Of course no! You will have to find a new property thereafter. When this happens, you could even be sued by the developer for the difference in price incase they later go on to sell the property for a relatively lower price.

2.Unpredictable market trends.

One thing you can never be sure of is how the market will turn out when buying property off the plan. It is like literally putting all your eggs in one real estate basket. If the market goes up, you probably made a good bargain. If the market remains goes down or remains flat, then you will have paid an inflated price for the house.

3. The developer may run bankrupt hence messing you up.

It is important for buyers to do their due diligence thoroughly before signing any real estate contract with the developer. This is because some developers may go bankrupt hence messing the entire project. Eventually, you are the one who lose it all here because you will have paid 10% deposit before the completion of the project.

Prospective buyers should ask the developer for evidence of past projects, contact people who have previously bought apartments from them, check for negative media reports, and, if possible, visit previous projects to assess the quality of the developer’s work. 

4. Delays that could lead to expiry of your mortgage offer. 

Setbacks in the homebuilding process are common. This brings lots of uncertainty, impacting your living arrangements and could lead to your mortgage offer expiring before completion of the project.

Generally, buying property off the plan has its pros and cons. It is therefore up to you as the property buyer to decide whether or not to purchase off plan. 

Looking for property (land, house or plot) to buy? We believe in a win-win situation where Parties involved in property transaction (our sellers, Baoriat Agencies and buyers) win by getting the best deal ever. For this reason, over the last three years we have had customers who seek for our services repeatedly. We will actively work with you to help you find criteria that works best for you. All you have to do is, call 0721-554-937 or visit Juma Hajee Building room 16 in Eldoret town, Uasin Gishu County.

Find Property in Uasin Gishu County


Baoriat Agencies

Call: +254 721-554-937

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