More Real estate Opportunities

I told you about so many opportunities in real estate:

1.     Get me a nice plumber and I will show you twenty quacks. This is a field dominated by the latter. I usually wonder whether they train people for this particular specialized field. There is this one I gave some work and he put a normal valve where a non-return one was needed with disastrous results and or consequences. When I called him and asked him why he did so, he said he’ll come back and put the right one. So he knew the right one but decided to test my patience. I almost called him PWD. You see when we were in primary school, there is this deputy headmaster who would call you PWD if you did anything silly. Of course by PWD he did not mean Print Working Directory, Linux gurus know what it means but he actually meant Punda Wengi Duniani.

2.     Of course I like rainwater harvesting and so if you want to know of another opportunity, then please specialize in fitting gutters. The other day I saw some nice ones made of plastic.

3.     How about these bio-digesters that will deal with septic waste and digest it. You may not have known but the technology behind these digesters involves introducing live bacteria in some sealed enclosure. This will need a whole lesson, but if you think you can hack it, bring this technology to us and we will not need those humongous septics that we always construct; after all most councils care less about sewer systems.

4.     While at the above, you may figure out how the so called septics are emptied and if you can withstand the effluent, get a honey sucker (exhauster) and PAP you are in business. But kindly ensure that your honey sucker does not conveniently change to a water bowser during the dry season; otherwise we shall report you to NEMA.

5.     This guy who fixes cabro keeps telling me that he has to consider some levels on the ground and how water will flow naturally and so on. I think he makes some good money; after all he also sells paving slabs, culverts, road kerbs and channels amongst other storm water drainage materials. He also claims to manufacture them and he is filthy rich.

6.     There is this painter who is very good. I know that because he insists that painting is an art. He also insists that before he embarks on the actual work, he must get a theme and some inspiration. Then he knows something about blending colors and mixing them. I saw a house he painted somewhere in Runda and it is inspiring. And he really knows colors, you see I did not know that peach is a color (isn’t it a fruit?). How about claret? I is almost color blind so let him not dwell on them.

I can talk endlessly about real estate opportunities; after all it is my field. In the next post I might tell you something about Guangzhou. After all isn’t it an opportunity? Think about all the above and tell me whether we are not in a land full of opportunities.

Opportunities in Real Estate

Real estate opportunities are visible all over Kenya. Turn around where you are sitting; open you bright eyes and you’ll most likely see one. After all, real estate experts will confirm to you that housing units developed annually in Kenya average approximately 30,000 units and this is way below the demand of around 150,000 units. So, just go ahead and cater for the deficit. The other day we had a chat with a buddy of mine and we concluded that there is so much for all of us; we cannot exhaust opportunities in housing people.

How about speculators? Obviously when you hear rumours about some upcoming road, it is time to move in. But many people wait until there is tarmac for them to buy. That time, investors are busy taking their profits. Just like in the stocks, buy!

Just a few upcoming roads you may have heard about:

1.     Greater Eastern bypass ….it is past design stage so it is just a matter of sourcing funds and starting the project. I have not enquired from that KURA guy on the latest.

2.     LAPPSET corridor. Need I say more…Lamu, Isiolo, Meru and many other areas.

3.     There is this road from Ngong to Mai Mahiu via Suswa. Sometimes back I went to those sides, up to some 50kms inside from Ngong and I can assure, there is cheap land upto 50k per acre those sides. Try that and you will definitely enjoy massive appreciations. By the way, when the bulldozers land there, you will be surprised to find the price of an acre shooting to 500k.

4.     They are also upgrading the Syokimau Katani road…

5.     Meru and Nakuru by-passes. Did u know that Naks is the fastest growing town in Africa?

6.     Around Konza, the ICT city

7.     By the way, Kisumu is another hotspot serious need for houses.

The opportunities are rather too many. By the way, if you have any interest in these infrastructural developments, visit http://www.kura.go.ke/index.php

And by the way in real estate we got so many other businesses that one can get into:

1.     You know sometimes am shocked at the kind of bills I receive from the Hardware guy every week. Massive opportunities here especially in places where developments are upcoming.

2.     Transport of Ndarugu stones, foundation stones, ballast, sand and what have you. By the way, did u know that for a single lorry of Ndarugu stones, the transport takes more than 50% of the entire cost?

3.     Contractor business?? Most large scale developers engage contractors

4.     Metal fabricators are also in huge demand…

I cannot exhaust the available opportunities in real estate, not in a single posting. If you are business minded, surely you can fit somewhere. More in the next post.

The underworld of Construction: Part 5

Timber theft explained

Continued from part 4

This guy who was measuring my timber at Kawangware spoke in a very soft voice but with a lot of conviction that I believed what he was saying. He actually confessed that the reason he left Rongai was primarily due to threats from one of the customers in the yard he worked for. The said customer after getting conned promised to come for the heads of all those he believed conned him; and that included this young man. Once he heard that the owner of the yard had been accosted by some boys who threatened to have his severed head and balls collected in one of the bus parks, he knew it was time to hit the road.

Without warning he started explaining the all-important tricks and I was all ears. You see that measuring tape is usually tampered with. If you are keen to observe, it will have some feet missing, as in it could move from 1 to 2 to 4 to 5 then to 7 to 8 to 9 to 11 to 12 to 13 then 15 and so on. This essentially means that if that tape indicates 9 feet, in the real sense the correct length is 7 feet. If it indicates 15 then the actual length of the timber is 11 feet and so on. In essence you could be losing 3 feet on average per timber. If you have a quantity of 2000 pieces, then obviously you will have lost as much as 6000 feet and if each foot is costing Kshs 30, then your loss would be as much as 180k. That is just one of the tricks.

The second trick he mentioned was in the recording of the timber as it is measured. You see, the fellows use a piece of paper and a pen and they normally draw tu-small lines depending on the length of the each timber measured. Meaning, there will be a section for 9 feet pieces, 10 feet, 12 feet and so on and a ka-line will be drawn in either of the sections depending on the measured and the ‘shouted aloud’ length. What I suspect happened in my case is that, the guy who was keeping the tally would add imaginary tu-lines whenever my foreman who was to keep an eye on him got distracted. When I flashed back, I remember that there were as many as ten fellows each given a specific role in the set up but some were just meant to distract us.

The other but most unlikely trick is to ensure that the timber is ferried in more than one truck and if you don’t have a trusted guy accompanying the lorry, then they can drop some at designated places on their way. And they’d go to the length of befriending your foreman or fundi in case you send them before the actual purchase and make him part of the squad to defraud you.

The other thing they’d do to novices would be to measure poor quality timber. For an experienced hand, whenever you encounter poor quality timber or one with unusable section(s), the feet are normally discounted or the entire piece is kept aside.

So how are you supposed to safeguard against such tricks. Read below:

1.      Make sure that the measuring tape being utilized is your own. It is better to buy one (they are very cheap) because it will obviously not be tampered with.

2.      Make sure that when the measuring is being done, keep your own tally for later comparison at the end of the measuring. In the event there is a discrepancy, then make it clear that your tally is the correct one. If they insist that it is not, then let the exercise be repeated.

3.      Always make sure you have a trusted hand (preferably your fundi) to verify the quality of the timber and be in charge of ensuring poor quality is set aside or the process of discounting the unusable sections is done and fairly so.

4.      Never trust your fundi or foreman to take charge of the entire process in your absence. Notice how easy it is to co-opt them into the gang and milk you dry. Never ever delegate this fully.

5.      Where possible, let the seller deliver the timber to your site and measure from there. At least in your site you will have absolute control.

I was conned in broad daylight by I told myself that it will never happen again. You see the other day I was purchasing timber and some guy from Ruai attempted to use these tricks on me. The fellow had discounted his prices with the assumption that he’ll apply the tricks on me. I proved a hard nut and after sealing all the loopholes, the measuring was done but at the end of the exercise, the fellow confessed he was to make a ‘loss’ because the prices were unbelievably low and he never managed to steal anything. He even contemplated chasing me away without the timber but I cornered him. The other day I called him and informed him that I need to purchase some more but he declined to sell to me; of course he knows am a bull that cannot be milked.

Be advised and don’t let them con you, least of all with these tricks. By the way, am sure they are probably devising other strategies to steal from unsuspecting Kenyans.

The other day I went to see some guy I had sold to some plot. He is currently constructing his residential house and what I saw on his site was quite sad. I discovered he is using the wrong professionals. Topic for another day, well next post.

The underworld of Construction: Part 4

Timber theft

Continued from part 3

This Momanyi guy found us on the site when we were busy chatting with my foreman and introduced himself. He was all smiles and presented to the foreman his quotation for timber. By the way, some of us who are small-bodied and sometimes dress anyhow without much thinking are mistaken for KYMs on site. That reminds me someday when my brother in-law came to see me on site and this entrepreneurial young man who wanted to enlist the owner of the house for garbage collection service was all over him asking for business and ignoring me…then my brother points at me and advised him that am the owner of the site to his utter shock and subsequent apologies…story for another day.

The quote in comparison to the others was so favourable, I could not believe my eyes; what with prices lower by as much as Kshs 3 to 5 per foot. I asked the guy why that is the case and he explained that they get their timber from Tanzania at very good prices hence the favourable prices to their customers. I swallowed that hook line and sinker and we agreed that we shall visit him at his yard and see the timber.

The day after we drove to Rongai together with my foreman and all the way to Nkoroi where the yard is located. We were loaded with the cash to do the purchase because it was meant to be a cash deal. They had very nice timber and we agreed that we shall buy from there. Immediately we agreed, he called some two transport guys and negotiated the transport on our behalf, a nice dude or so I thought. He thereafter called his men into action; around eight of them to measure the timber. We agreed that my foreman will keep any eye on the recording of the measurements while I keep an eye on the actual measurement, tight controls or so we thought. The timber was measured and loaded without any issues and truth be told I never noticed any anomaly. It was then transported to my site and offloaded.

Something crossed my mind, I thought it was wise to verify the delivery. I thus instructed the fundis to measure the timber again. To my utter shock, what I paid for as compared to what I had on the ground had a discrepancy of 40%; in other words it was 40% less. Wait….so what happened. I thought I had a hawk eye when the measuring was being done and I also accompanied one of the delivery trucks to the site while the foreman accompanied the other. Mystery, mystery…conned in broad daylight…but how??

I swung into action, called the guy and told him that he had conned me. Of course he refused. I insisted that I’ll take up the matter to the cops but he sounded unmoved. I drove back to Rongai the morning after and reported to the police station about the ordeal. The cop serving in the OB section just laughed at me and before I finished my story he asked me whether I had bought the timber from a certain yard owned by Kisiis. He confided in me that they have received so many complains about that yard and they have not managed to do anything because it is hard to prove that the guys actually steal…wait…: ”And why don’t you set a trap to confirm is they steal”, I asked him. Of course they never really bother because in the past despite arresting the owner severally, the guy always found his way out mysteriously. In my thinking this obvious pointed to something bigger and I therefore so no need of pursuing the matter further with the cops.

I went back home dejected and trying to figure out how to deal with the matter. I even contemplated using unorthodox means to recover the loss, like threatening to go for the owner head with them boys. Painful as it was, I decided to cut my losses as opposed to throwing good money in an attempt to recover the loss. How then did they steal from me??

After utilizing the timber which was far less than was needed on site, I decided to shop around and look for a place to top up. My little shopping around landed me in Kawangware where I met a lady who owned a very well stocked yard. We had a chat with her in her office and I told her about the Rongai incidence and she laughed at me. Before I narrated the entire ordeal, she told that it is commonplace and especially in some yards in Rongai to get sellers who underquote but steal from you. She advised me that it is better to pay the market rates and get value for money as opposed to look for cheap stuff and get conned. Anyway I bought timber from her and after confirming the delivery on site, it was tallying with what I paid for. But while her KYMs were measuring the timber, one opened up and confirmed that he once worked in a yard in Rongai and he had no qualms telling me the various ways they were stealing from unsuspecting customers.

It will shock you but in the next post I’ll tell you how it is done and how to arm yourself just in case some fellows have planned to do it on you. I was conned in broad daylight but some things you never wish they happen even to your worst enemy…. Be warned and advised.

The underworld of Construction: Part 3

Continued from part 2

I embarked on having controls in place to safeguard my interest; after all it was plainly obvious that all and sundry were out to milk me dry. I had to look for another hardware guy and this time round I strictly instructed him to only deliver good in the evening at around 6 PM in my presence. I’d personally verify the goods.

I also managed to get a new foreman who role was only to supervise the fundis and the KYMs and nothing else. I took charge of negotiating with suppliers and paying them. I realized that this was a big loophole in the initial set up. What the other foreman would do; he’d insist that anyone supplying anything on the site, must part with something small for him. Once a supplier is compromised, it simply means they can just enter into an arrangement to supply air as long as they both gain.

To safeguard against loss of man-hours (fundis and KYMs) I’d demand that the foreman pre-plans the work and for each phase he’d give me the labour estimates to finalize the works. I’d independently confirm whether the estimates made sense. I’d then give him some contract to finalize the works and would obviously throw the control to him. He’d then push the fundis to deliver and maybe make a small saving. That arrangement worked well for me because I’d relinquish that bit of getting the best out of the workforce.

As regards material pilferage, I took one of the guys on site and made him a mole. He’d be my eye on the ground to ensure no-one steals materials. But again bestowing all this trust on one person never brought a sense of security on my part, you see once bitten twice shy. So I got yet another mole and as long as I could get comparative info from them, it made much sense to me. And by the way, you should never keep a mole for long; after all they easily get compromised, so you keep shuffling them. I’d also make surprise visits just to ensure that am unpredictable.

The other thing which I intentionally did and which worked is to create a perception that am really very tough. The moment these fellows realize you are a weakling, they’ll take advantage of you. But when the fear is instilled in them, then they’ll think twice. If you have to slap someone, take them to the cops or whatever else you can do to instil the fear.

I managed to bring some sanity on the site after the tough lessons. The other very important thing I noted regarding procurement was the fact that same items, same quality, exact products would retail at different prices in different hardwares. You’d be shocked to sometimes even find a price difference of 20-30% in hardware’s within the same locality. Some clever hardware guys’ will also price some items cheaply and creates the perception that all their goods are fairly priced, only to inflate other goods once you become a repeat customer.

I also realized that well priced and professionally approved alternatives would also create a big saving. Like I discovered some items they call fibre mesh which act as a very good but much cheaper alternative to BRC mesh when casting the slab. You’ll also hear of pre-cast concrete blocks which I have never used which can bring a saving as opposed to the conventional mass concrete.

Finally, investing in knowledge is extremely important. Like being able to interpret a BoQ would give you an idea of the materials estimates as opposed to relying on that jua-kali foreman. Get to know what a substructure or superstructure is, even those Y12's and Y8's should not sound like Greek, and even those impregnated tank bearers and slats should not overwhelm you. There is a certain word I heard from the fundis which was quite funny…'makirigishi'…of course I had to understand what they were but I’ll leave it to your imaginations.

In thenext post I’ll tell you about how that crafty Rongai fellow conned me in the name of selling me timber…and the useless cops who could never help me....

The underworld of Construction: Part 2

Continued from part 1

You know the BoQ (Bill of Quantities) is quite interesting. It contains costs which are not so big individually but when you add the figures up, the totals are massive. When the architect brought the BoQ, it was quite tricky to understand it, being the layman I was. I am surprised these days I can make a lot of sense from it. You see when it talks of substructure, superstructure, form-works  cubic meters for mass concrete, twisted bars etc.; it can dwarf your knowledge. I demanded that the guy supplies me with a schedule of materials which is much easier to understand. You see 5 lorries of sand, or Y8s, Y12s and the likes makes more sense to a layman.

Before it escapes me I recall that incidence when we were to cast the slab and my good neighbor who had promised to give me water; a circus it became. On the materials day, the koroga squad arrived by 6 AM and quickly set up the machinery, then they proceeded to carry cement from the site house and they emptied as many as 20 bags on the ground…by the way, the operations of this koroga squad is rather organized and interesting. The toughest guys will be somewhere they call “Chini ya mnazi”; just next to the concrete mixer and their role is to load mass concrete atop wheelbarrows. The lightweights will be assigned simple tasks like pouring water, cement, sand and ballast inside the mixer. Interesting these fellows know how to balance the ratios inside the mixer…don’t ask me how they co-ordinate, please observe. Back to my neighbour’s story: When some fellows went inside my neighbor’s compound to get water, the lady of the house came out with a machete claiming that the water was given without her authority. The man being a man wanted to show his authority and attempted to force the lady into submission but when the machete was wrestled from her, she started wailing and close the gate. She held onto the keys like her life depended on them. I had to utilize my negotiation skills but they never worked till I parted with some 2k to appease the lady and finally she gave in.

Life gets quite interesting. You know the same lady was once thrown out of the house by the husband and the dude disappeared to Western and switched off his phone. I found her outside the gate and she pleaded with me for some coins to take her to her Meru. Of course I remembered the water incident but decided to let it pass and I gave her cash enough to eat some meal and ferry her stuff to her shags.

Back to the construction of my house: You see I noted that I had lost it and fired all the workforce and I had to figure out how to move on. But I had to understand how these fellows were stealing from me. And so I confided in one fellow and he opened up. The fellow eventually became my mole. The chief architect of the thefts was none other than my own brother (who was to be my eye on the ground). He was a wolf in sheep’s skin. You see he knew what all the others were doing and he’d get a cut from each. He was the guy who was meant to confirm and receive supplies in my absence. Some of the deliveries were less and I’d pay for the expected full deliveries. It is very easy to receive 9 cements and pay for 10, after all the difference of one when already utilized is barely noticeable. The hardware guy would bill me for quantities which were not fully delivered. I’d only check on the delivery notes and assume that what was there was accurate. The foreman was also cheeky; he had two sites and would utilize some of the KYMs on the other site whereas I was the one paying them. Just before I arrived in the evening, I’d find them on my site and assume they worked the whole day. Poor me.

I knew the only way out was to install controls at all these levels. I also had to have a grip of the procurement process because therein was the biggest loss. The controls worked wonders and I’ll outline them in the next post. However, this never prevented me from being conned by the timber guy in Rongai. This was my last loss but I learnt a lot from it. More in the next post.

The underworld of Construction: Part 1

Guest post by Samuel G. Njenga

I constructed and my final verdict is that everyone on that site was a thief unless they proved otherwise. You see these fellows thought that I had loads of cash (limitless) and all they wanted was to squeeze the most out of me, illegally and otherwise.

I set out to do my residential house with the little cash I had and hoped against hope that someday I’ll live in my own home. The dream came to pass but by the end of the project, I had some Solomonic wisdom regarding the dealings in that world; which I will share with you. The trusted hardware supplier stole in cohort with the clerk of works, the jua kali foreman stole, the timber guy based in Rongai stole, the KYMs stole cement, the fundis stole man hours and my rogue brother meant to assist reduce the pilferages also colluded with them that stole…but they only did it for a short time because my eagle eyes and a bit of investigative skills and that mole, actually two of them helped me…Someday I woke up and decided enough was enough, slapped the foreman after a lengthy rebuke, fired all of them workers, sat down and reflected on the way forward, installed controls before resuming the construction….welcome to the underworld that construction has become.

It started with profiling of the house and using lime to mark where trenches were to be dug. No sooner than the markings were done, a gang of Mungiki youths showed up demanding to dig the trenches, in their own words, that work was set aside for them and no-one else. And you see they were to charge some fee 3 times compared to the usual charges from other KYMs…of course I told them I had no money and will call them when am ready only for them to show up a few days later and find the trenches already dug. Few threats here and there but they disappeared into thin air.

Then I met this guy who would supply everything in this world and dude is an architect by profession. Kamau will have a solution to all problems; he will get you fine sand from somewhere past Athi-River, he’d hook you up with some cheap AFCO cement, he owns a lorry that he’d use to get foundation stones somewhere in Ruiru, Ndarugu stones as well. Wait…Kamau knew where to also get some nice trees which we can split and get timber…actually that guy who prepares the timber is a good friend of his…this Kamau even had the best of painters and metal fabricators around. The interesting thing about Kamau is that he even proposed redesigning my house to make the roof better, space utilization…sijui nini…and so I asked him, “Kwani Kamau you know everything, what is you speciality ” I smelled a big rat here and avoided Kamau like a plague. And by the way he used to sniff snuff; that powdered tobacco…and that really put me off and so I dismissed him.

By the way, when they were digging those trenches for the foundation, it emerged that the hard rock was as many as 7 to 10 feet below ground level. You see when I flashed back to that time I was buying that kaplot and that agent who usually drinks himself silly showed me some rocky area within the plot and I thought that doing the foundation would be very easy on that plot only to be confronted by that thick layer of hard core stones upon digging the trenches. So this place was actually a quarry at some point, which was back filled with hard core stones and a layer of 1 foot thick cotton soil; so in other words what I bought was a quarry plot. This architect of mine who doubled up as a structural engineer returned a verdict that we could only suspend the house as opposed to doing 7 to 10 courses of foundation stones…..suspend the house..in the air or what?..I wondered. So he explained the concept of suspending…doing columns to the level of the hard rock, then some beams at ground level to support the walls..

Then I realized that not only had I got a raw deal of a plot, but I was in for some more surprises…most of them very costly….and I will tell you how I formed a habit of whistling subconsciously when confronted with those costly surprises…and this neighbor of mine who promised to give me water for koroga only for the wife to decline on the material day of koroga, having already assembled the team and machinery and my begging mission to salvage the situation that had boiled down to a teary fight between man and wife……more in the next post.

Of minors and registration of land in trust

Guest post by Samuel G. Njenga

You probably don’t trust your wife/husband that much and you think it is wiser to register that property in the name of the kid. In the new act (Land Registration act 2012) the issue of minor’s registration is dealt with in section 47:

1.     “The name of a person under the age of eighteen years may be entered in the register to e n a b l e the minor’s interest to be held in trust and shall be registered under the name of the guardian either on first registration or as a transferee or on transmission.

2.     Nothing in this section enables a person under eighteen years of age to deal with land or any interest in land by virtue of such registration, and, if the Registrar knows a child has been registered, the Registrar shall enter a restriction accordingly.

3.     If a disposition by a minor whose minority has not been disclosed to the Registrar has been registered, that disposition may not be set aside only on the grounds of minority”

In simpler words the minor’s name will be entered in the register but the minor cannot transact in the land till they reach 18yrs of age. When the minor reaches 18 years of age, the trust lapses automatically.

The title is usually registered under the name of the guardian (s) as trustees of the minor as below:

Guardian 1 name and Guardian 2 name … as trustees of Child of Birth Cert no…

In the event that the guardian is more than 1 and the one of them expires (dies), then the other guardians cannot take charge of the entire trust, in fact the deceased guardian ought to be replaced. The details of the trust should basically deal with how the transmission will be done. In the event the details are not there, then laws on general trusts will prevail. If all the guardians expire, then an option of the public trustee taking charge may be explored.

So, how is a minor to be protected?

When a guardian or guardians registered in trust decide to transact with the land, then it must be in the interest of the minor. Suppose you are purchasing such a piece? Ideally, when you are in the know that the land is under a trustee then you may want to ensure that the money you pay goes into an account in the name of minor and if such an account does not exist then it is prudent to insist that one is opened by the guardian.

A good registrar should actually seek to understand why the land is being sold and should at least ensure the minor is protected. It may not be strictly in the law but the interests of the minor must come first. As a buyer never write cheques in the name of the guardian especially when you know that they are just but trustees. It actually means they don’t own the land but are just holding it on behalf of somebody else.

Did u know that welfare groups cannot own property including land? In fact, if such a group wants to own land it can only be registered in the names of some or all of the members in trust.

Next we look at leveraging on debt in real estate.