Buying land is generally viewed as an expensive venture. However, this is not always the case. Based on the basic social amenities like roads, schools and electricity, the cost is worth. Let us look at key affordable ways of buying land. Below are four nuggets on how to buy land cheaply.
Buy in Cash
To begin with, you can buy in cash. In most cases, this either allows a client to purchase at the marked price or less. For instance, at Pamoja Housing Co-operative Society, this mode of buying earns a client a discount of 5%.
Make a huge deposit
The next thing to consider is making a huge deposit for the land. By way of example, at Pamoja housing co-operative, the plot deposit is 30% of the selling price. Te more a client deposits, the cheaper. This is because the amount that is to be paid in installments is the balance. The balance comes with an interest of 15% per annum. If client A deposits 30% while client B deposits 50%, if the balance is paid in the same period, client B will pay less than A. By way of illustration, let us take the selling price as ksh. 600, 000. Client A will repay 420,000 with an interest of 15 per annum while client B will repay 300,000 with an interest of 15 % per annum.
No Interest Period
Besides, inquire from the company the period within which no interest is charged. At Pamoja housing co-operative society, this is 3 months.
Paying in few installments
Paying the balance in few installments or in a shorter period is a wise thing to do. Paying land in extended periods seems convenient. It does not have much demand but in the long run, it will have dug quite deep into your pocket. At Pamoja housing co-operative, land interest is charged at a reducing balance. For example, if in the first year the land balance is 1,200,000,the interest paid will be 180,000.in the second year if the balance reduce to 600,000,the interest will be 90,000.if this balance is cleared at this point , the interest paid will be 180,000+90,000 =270,000 but if another year is added, the interest will continue to accumulate.
In conclusion, to buy land affordably, engage the real estate advisors or vendors to find out the available options.
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