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From an economist perspective ( I am not ) the short run is not a good thing unless you bring home your takings. As time goes, there is a convergence towards an equilibirium; but you are right there are some monopoly profits to be made. Besides, rent seeking politicians and the nature of uncertainity is a big disadvantage saaxib. There is another element which we cannot discard; many somalis think rents as high as 5000 dollars is a hit but that is relative. You could develop a property in Europe and make twice that.lamagoodle, thats why now is the time to do it before that happens
but in somalia you already own it... all you are doing is renting it out to a tenant.. thats better than putting $250k in a house in the west..From an economist perspective ( I am not ) the short run is not a good thing unless you bring home your takings. As time goes, there is a convergence towards an equilibirium; but you are right there are some monopoly profits to be made. Besides, rent seeking politicians and the nature of uncertainity is a big disadvantage saaxib. There is another element which we cannot discard; many somalis think rents as high as 5000 dollars is a hit but that is relative. You could develop a property in Europe and make twice that.lamagoodle, thats why now is the time to do it before that happens
The epicentre of the problem is not the rent but rather the underlying investment; the 1 million dollar issue. Pay off time is rather long.
True, but to own it you have invested in it. A one million dollar investment with a return of 5000/month in a country with a weak institution is not as good as 250 000 investment with a return of 3000/month in the west.but in somalia you already own it... all you are doing is renting it out to a tenant.. thats better than putting $250k in a house in the west..From an economist perspective ( I am not ) the short run is not a good thing unless you bring home your takings. As time goes, there is a convergence towards an equilibirium; but you are right there are some monopoly profits to be made. Besides, rent seeking politicians and the nature of uncertainity is a big disadvantage saaxib. There is another element which we cannot discard; many somalis think rents as high as 5000 dollars is a hit but that is relative. You could develop a property in Europe and make twice that.lamagoodle, thats why now is the time to do it before that happens
The epicentre of the problem is not the rent but rather the underlying investment; the 1 million dollar issue. Pay off time is rather long.
Good idea brother. But that entails social costs i.e. not good for a country like SOmalia. Somali business/investments are path dependent and based on a rationale which is "hebelba waa sameeyee anigana aan sameeyo". At the end of the day, the bubble will bust (are you aware of the property bust in UAE)? The good thing is that maintaining an unrented home in somalia is not high. And there are no loans/interest rates to pay (well, sometimes there is but it is through relatives). Other than that there is no logic in investing there except maybe investing toxi money.lamagoodle, get your short run returns now and when things stabilize go on a diff move
I agree. But Eastleigh is also a bubble that will bust soon.Apart from being a truly free market capitalistic country, Somalia is possibly the worst country to invest in (right now). But I truly respect those that are investing. It is they who will lift the country from its misery.
But there is no guaranteed security there (for property, business, assets). And there are no property rights and laws. I wouldn't even invest in the safest cities. What makes you so sure some rebel group wont emerge and take over property like Al-Shabab does? "If you don't give us your house, you are gaal and you must be killed according to Sharia."
The ironic thing is thing is that I do have some investments there but I am itching to just sell them.
There is a reason why the Eastleigh business owners are not rushing back to Somalia in droves.
There is a general election in Kenya next year; and there is a very big risk that manchette welding thugs will cause havoc. I was reading yesterday about armed robbers in their dozens attacking somali properties.It'll burst when Somalia gets peace and stability
If all these investments we put in Kenya and elsewhere would have been put in Somalia we woould have been in a better shape...,
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