Real Estate is undoubtedly the most lucrative industry in Africa. You do not need millions to invest in this booming industry, rather, a keen eye to observe and analyse well: Like the industrialist Multibillionaire Chris Kirubi always says, Mathematics don’t lie. You will never go wrong with good calculations. Search of affordable housings in Africa is on the rise thanks to the rise of middle-income population. In this guide, you will find out how to invest less than $1,200 and get more than $10,000 (and why not more?) in less than 360 days. After reading this analysis which has been tested several times, you will disagree with Mark Cuban who says that only morons start a business on a loan! In fact, you can go straight to get one afterwards! Kenya – the East African leading economy – has been taken as a case study in this analysis.
The Whole Idea…
There is a serious housing deficit in Africa. Like any other good entrepreneur, solving this problem will give you good money by providing affordable housing. Taking examples like Egypt with a population close to 90 million has a deficit of 3.5 million houses. In Nigeria, Africa’s most populous country the situation is not any better with only 100,000 new houses being built annually compared to an annual demand of 700,000 and an accumulated deficit of some 17 million houses. In South Africa the deficit stands at about 2 million houses.
In East Africa a look at Kenya suggests the picture is the same. A woefully inadequate housing stock with reports placing annual demand at 200,000 while supply is at only 50,000. The 2013 Housing Survey by the Ministry of Lands and Housing in Kenya estimated the deficit at 2 million houses over the next 10 years.
Solving this Problem
The whole idea of this investment, is to provide affordable housing using affordable and yet durable building materials commonly known as ISSB or Interlocking Stabilized Soil Blocks. This process will give you four (4) important sources of income: Selling ready-made ISSBs, renting out the machines that make ISSBs, you can raise buildings and sell them and lastly, you can empower communities: youth and women groups, cooperatives, saccos, schools, and so on.
This study was undertaken using clients who bought Interlocking Stabilized Soil Blocks (ISSB) Pressing Machines from the award-winning company – Makiga Engineering Services Ltd – which has more than 30 years experience in making construction machines in Africa. They have sold their machines to the United Nations (UN), Governments around the world, real estate companies, entrepreneurs, individuals, research institutions and so on. All these clients are based around the world: USA universities, Israel and Haiti after the devastating earthquake; and to more than 20 African countries and still counting: Kenya, Uganda, Tanzania, Rwanda, Burundi, Sudan, South Sudan, Zambia, Malawi, Mozambique, DR Congo, Ghana, Cameroun, Zimbabwe, Botswana… and so on.
Why, Where and How to acquire Interlocking Soil Blocks Pressing Machines
The UN Habitat recommends the use of Interlocking Stabilized Soil Blocks manufactured by Makiga in construction for protecting the environment since there is no burning of bricks, hence no use of firewood or any other fuel! They also mention that there reduction by more than 50% on all your construction costs wherever you are on the planet! The UN Habitat made this recommendation after testing different machines from all continents and Makiga’s ISSB machines were the best in terms of durability, eco-friendly, and cost-effective. For example, If you had budgeted to build a home/water tanks… at $10,000, the cost will automatically be lower that $5,000 if you use ISSBs made by Makiga soil blocks pressing machines.
A self-contained 3 bedrooms house (1 sitting room, toilets, shower, kitchen, 3 bedrooms…) in Kenya may require from 7,000 to 9,000 blocks only. Nevertheless, the number of the blocks may even lower to 5,000 blocks/bricks but it will depend on the design and the sizes of rooms. A block is comprised of around 80% of soil (preferably red soil but any other soil which is not black soil will be okay) and 15% cement. A bag of cement will give you approximately 100-150 blocks depending on the soil type. The standard interlocking block press machine that produces a block size of 10x6x4.5 inches and costs around Ksh109,975 vat inclusive. The wide straight interlocking soil block press machine producing a block size of 9x9x4 inches. It costs kshs 122,290 vat inclusive. Curved interlocking block press machine costs Kshs129,805. Curved blocks make excellent water tanks, wells, septic tanks or round houses.
Talking about Cash
With 3 men working as labour, you can make around 800 blocks/day depending with the speed. You can sell a block at any price you wish but they range from Ksh25 ($0.25) to Ksh45 ($0.45).
If you seriously want to invest into this, you can choose one of the types of revenue generation mentioned: Selling ready-made ISSBs, selling built houses, renting out machines, empowering communities; this can give you around $900/month after all costs if you are not not working hard. You can easily break-even in less than 3 month having bought the machine at $1,200 (or less). In 1 year, that will be more than $10,000 in profit if you have 1 machine!
Invest $1,200 and get returns of $250,000 in 5 years, $500,000 in 10 years!
Let’s assume you want to focus on just acquiring machines in the first year and target making money in the following years: in every quarter you can be buying a new machine with money generated from the previous one. Since 1 machine can break-even in less than 4 months, in every 4 months you can be buying an ISSB pressing machine. At the end of year you will be having a total of 5 machines generated by just investing less than $1,200. In the next 5 years you will make: 5 machines x $10,000 x 5 years = $250,000. In 10 years, that will be more than $500,000!
How and Where?
Makiga Engineering Services Ltd is headquartered in Industrial Area of Nairobi: Exactly on Lokitaung Road Off Likoni Road Kenya Industrial Estates, Godown No. 27. They have a wide range of machines: Soil Block Press Machines, Multi-Purpose Vibrator, Master Mill, Stone Crusher, Concrete Tile Machines and so on (you can check more on their website http://makiga-engineering.com. When you place order, the delivery will be fulfilled to wherever you are in East Africa (and other parts of Africa) and training for the machine use will be availed to you! Just Contact:
KENYA: Nairobi: Call/Whatsapp: +254721599866; Eldoret: +254721318717; Mombasa: +254718852699; firstname.lastname@example.org
RWANDA: Call: +250787304403; +250783255742; E-mail: email@example.com; firstname.lastname@example.org; email@example.com
TANZANIA: +255744199000. firstname.lastname@example.org
UGANDA: +256756566566; or +256776488688. email@example.com
Rest of Africa: Call/Whatsapp: +254721599866
To create this kind of Beautiful, Classy, Comely, Enticing, and Excellent structures, you simply need #MakigaMachines
— Makiga Engineering Services Ltd (@MakigaKe) January 16, 2018
What are you waiting for? Solve African housing problems and be wealthy!
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Business Analyst at Tunayo Business Magazine | Follow me on Twitter