What I Learned Trying to Sell My Dad’s “Maguta Maguta” Plot for 2 Years

EDITOR’S NOTE: This article is part of our Money254 Partner Series produced in partnership with Vuka, an investment club that allows Kenyans to invest in the Acorn Student Accommodation I-REIT.

Last week, we held a Thanksgiving party for my mother’s recovery, a bittersweet moment for our family. We walked down memory lane, remembering the hustle of fundraising for her treatment abroad. We created countless WhatsApp groups, made sacrifices, and sought help from friends and family to get mum the urgent treatment she needed.

My dad, being a retiree, was stranded. With his pension, he had gotten a one-acre piece of land in the prime areas of Ruiru, a “maguta maguta” plot as he liked to call it.

At a time when we desperately needed Ksh2.5 million for mum’s treatment, we thought, "Why not sell that piece of land instead of involving people in our family affairs?" This idea seemed perfect because it also meant keeping her condition within the family. However, selling the land proved to be a tiresome and lengthy process, especially because we needed the money urgently!

The Ground is Different

We thought we were about to hit the jackpot. Dad always bragged about its prime location, its massive potential for appreciation, and how it was a gold mine waiting to be tapped. Little did we know that selling land would be no walk in the park. 

We listed the land for sale, expecting buyers to flock to us like bees to honey. Spoiler alert: they didn’t. Days turned into weeks, and weeks into months. 

We tried reducing the price below the market rate, but nothing worked. It was a sad tale of endless negotiations, flaky buyers, brokers, and a real estate market that seemed to be in no hurry to accommodate our urgent needs. Each day, as mum’s treatment delayed commencement, our frustration grew.

Dad, ever the optimist, kept reminding us of the land’s value. “This land will fetch us a fortune,” he’d say, while we sighed and looked at the ever-growing list of prospective buyers who never called back. We held on to hope, thinking the next buyer would be the one. But hope doesn’t pay medical bills. That is when we resorted to fundraising. 

This experience taught me a few valuable lessons about investments and liquidity. Owning a piece of land is great, especially in a prime area, but it’s not always easy to convert that asset into cash when you need it. That’s when it hit me: having a balance between physical and financial assets is crucial.

I Dodged a Bullet

Fast forward to March 2024. Here I was working hard and trying to find avenues to invest. Grabbing every opportunity there was to invest and save my hard-earned money wisely. 

I made a resolve to always diversify my portfolio. I opted to balance between tangible assets like land (as my dad’s son, this is a must!) I also put savings in my Sacco.

In 2021, I learned of I-REITs (Income Real Estate Investment Trusts) from one of my close friends at work. I started putting in Ksh5,000 every month. 

Just weeks after my 34th birthday, a time I considered ripe in my career journey and geared up for a promotion, I was laid off. My heart sank as I felt my dreams quickly shatter in the blink of an eye. It was a tough time.

Luckily for me, I was able to raise cash for a small eatery that I had always dreamt of opening. Having diversified my savings became my lifesaver. The Sacco could not give me back my savings and I could not get a loan - having lost my job. 

Of course, the small piece of land I had bought in Matuu could not get a buyer in the period I needed my money. 

The lifeline became my shares in the Acorn Student Accommodation I-REIT which I was able to sell with ease, through the Vuka Investment Club. This flexibility saved me from the same predicament my father faced. Having financial assets that I could quickly convert into cash made all the difference.

Read Also: Real Estate Investment Trusts (REITs) in Kenya: How they Work and How to Invest

When I started investing in I-REITs, I was amazed by their innovative approach to real estate which so many Kenyans love. They offer rental income through dividends, capital appreciation (much like owning physical property) - but they have the bonus of liquidity. 

I remember how tough it was trying to sell dad's land when we needed money fast. Having something that could easily get me cash at a time I badly needed was a lifesaver. 

I-REITs also generate regular passive income, as I think about it, this would have been a Godsend when we were struggling to pay for mum's treatment. Plus, they allow me to spread my risk across different real estate properties, which feels a lot smarter than putting all my money into one piece of land.

The Vuka Investment Club

What drew me in, though, is that they don’t require a huge upfront investment. Unlike buying land, where you need a lot of money to start, I-REITs let you get in with smaller amounts. This made it easier for me to start diversifying my investments.

Joining the Vuka Investment Club has been a game-changer. They’ve helped me understand the importance of balancing physical and financial assets and guided me toward making better investment choices, something my father didn't have.

While dad's "maguta maguta" plot is still valuable, it is not making us any money. The silver lining is that the struggle we went through selling it showed me the real-life value of liquidity and diversification. Investing in I-REITs has given me the flexibility to handle financial challenges and jump on new opportunities as they come.