By David Tumwesigye
MD Victoria Nile Estates
We dream of living rent-free in the haven of a home we can call our own. Are you looking to live the dream but wondering where to start?
Based on my many years of experience in the property market, I have created six steps to successful and worry-free home buying.
Step 1: Start with the finances and make sure you understand your budget. First, identify what you will need as a deposit and how to go about getting a mortgage that is right for you.
Not many of us can buy our home outright with cash. Most people need to consider a mortgage – a loan provided by a mortgage lender or a bank that enables an individual to buy a home with an initial down-payment and raise the remaining funds through their mortgage.
Jackson Emanzi from Housing Finance Bank explains “Typically we advise someone to consider the home they can afford in terms of a multiple of their salary (or combined salary for a couple). To raise the money for this purchase they will typically need a deposit of between 10% and 25% of the total cost and then by using a mortgage, paid off over a period of 10 to 20 years on a monthly basis, the rest of the funds are raised through a loan. The typical monthly mortgage payment for a house may be slightly more than the equivalent rent. But unlike renting, you own the home and the value increases considerably over time. So, you own something worth a lot more than you paid for it”.
Another option growing in popularity in Uganda is a rent-to-own agreement. This involves paying a deposit to a developer and an agreed monthly rent, and at the end of a set period, you own the property.
The monthly rent is usually a relatively small increase on your current monthly rent, but it allows you to own a property rather than continuing to fund your landlord’s investment portfolio. This has been a popular approach in the US and Europe, and we now have property developers in Uganda, such as Jakana Heights, who are offering this opportunity.
Step 2 – be clear about the location and amenities you need. A well-situated home is not only an intelligent choice but also a profitable real estate investment.
I always suggest people consider a smart investment area that will appreciate more quickly than an already established premium location. These smart investment areas are in up-and-coming locations that offer unspoiled surroundings, yet recent investment in roads means fast connections. These two things combined attract businesses to set up, increasing the availability of desirable amenities. As a result, the location quickly becomes a destination choice. A good example is Konge Hill, an up-and-coming area in Buziga. This location is already tipped as one of Kampala’s top smart investment locations.
When purchasing a home, it is wise to take a good look not just at the property but the surrounding area too. Take time to visit and walk around the local amenities before making your final decision.
Step 3: Take the advice of an expert. Making an informed and well-researched decision involves talking to the experts such as real estate agents and brokers. They can give you a good understanding of what is happening in different areas, especially on how properties are valued and likely long-term growth. They will also save you a lot of research time by providing knowledge about essential matters such as security and the quality standards different developers set and meet.
Another source of expert knowledge are business owners who have chosen to invest in the location and make it a success. Managers of local shops, cafes, and hotels are a great source of information.
Step 4: Have a checklist when you are viewing a property. What are the essentials you need, and what are the issues to look out for? Viewing your property is an integral part of the home buying process as it gives you the chance to ‘sniff out’ any issues. Don’t be afraid to ask lots of questions; take pictures if granted permission, so you can look back at the details and compare properties. Pay attention to specifics that might warn you of underlying problems – damp smells, signs of poor drainage, evidence of leaks, poor maintenance or upkeep of the communal areas and gardens. And remember the hidden essentials like a backup generator.
Step 5: Quality Interior design is another crucial factor on the checklist. Affordable luxury is my top tip in today’s market. More developers in Uganda are making this part of their offer. Developers, for example, Jakana Heights, are employing architects to make this central to their construction vision. Look out for developments , like Jakana Heights, that come with designer touches included in the price—for example, stylish kitchen fittings and a deluxe bathroom as part of the developers’ all-inclusive package.
Step 6: Make sure you have dotted the Is and crossed the Ts with advice from an expert real estate attorney. Noah Wasige, a Partner at Kirunda & Wasige Advocates, advises, “There are several things to check when buying a home, but most important is ensuring you have proper title to the land and undisputed site ownership. These can be complicated and expensive, so buying from a trusted developer who has already completed all the due diligence and has proper legal entitlement can reduce uncertainty, costs, and time.
Buying a home is one of the most significant purchases you’ll ever make. I hope my six steps to success kick-start your plans to turn a dream of owning your own home into a happy reality.
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