How to avoid being conned in off-plan property purchases
HOMES: Poor costing, inadequate preparation of projects have been blamed for failure of off-plan housing investment in the country.
The housing model allows the purchaser to invest their money into a project that is yet to be developed or to be completed, on the promise that the property will be fully constructed within a particular time span.
However, the plan which has been the path to home ownership for low-income-earners has recently turned into an unpleasant brew with thousands of Kenyans sinking millions to fraudsters in the real estate sector.
The grievances by most off-plan purchasers include the failure by the developers to deliver on their promises or to deliver them on time and developers delivering poor quality properties.
Other cases involve purchasers being duped by unscrupulous people who pose as developers only to later find out that the purported developers did not own the land on which the proposed development was to be undertaken.
Experts advise that before entering an off-plan purchase transaction, the purchaser or their advocates should conduct exhaustive due diligence on the parcel of land on which the developer intends to construct the property to ascertain that the developer owns the land.
But the mess in the investment plan, according to experts, cannot be entirely blamed on rogue developers as some at times are affected by such factors as fluctuating economic situations and design failure.
Peter Kaloki, Lifestyle Estates managing director says despite off-plan being the cheapest housing model, poor costing of housing projects largely results in mistrust in the event that the final construction cost surpasses earlier estimates.
“Most developers usually have zero intentions of deceiving their clients but most of them are pushed to request additional project funding,” added Kaloki who spoke during the handover of completed 158 housing units at Lifestyle Heights located at Tatu City, in Ruiru, Kiambu County.
Start of projects
He said many off-plan-built houses fail to succeed not because developers have bad intentions but because they failed to do accurate costing before the start of projects.
‘In our case, we have brought on board all the professionals required in the field to ensure we do proper planning and in this case, we rarely fail to deliver our projects on time,” Kaloki said.
Cases of potential home owners being defrauded by property developers have recently increased casting a dim light on who to trust for not only financial but also quality delivery of housing works.
