Posted by: Martin | March 26, 2010

Good and somewhat less good news

Good news are that the construction of the Yopougon studios is progressing fine, with no setbacks at all.  The builders are a family my partner has known for decades where funnily enough all family members are in the building business, each with different specialisations. We think they are pretty honest, but nevertheless decided that  paying them the full amount at the start of the construction was not a good idea.  What we have done on multiple occasions is to  go with them where they purchase building materials and pay the purchases directly.

I’m losing my fear of managing  (small scale) building projects in Abidjan, which means I can start looking at buying plots of land.  Looking at the numbers, buying land and building on it – quite unsurprisingly – seems to generally give better returns than buying a houses directly.

The slightly less good news is that I have decided not to buy the studio in Port Bouet. I intended to let it on per day basis, and put out a few ads for it during a three week period to check the demand, but got no responses.  It’s not high season at the moment, but I think that the main problem is the location, people who look for a reasonably nice place for a short stay in Abidjan prefer other areas.

On a per month basis it would have given an ok, but not great gross return of maybe 9-10%  which would have been reduced on a net basis by the cost of getting to Port Bouet and collecting the rent.  It was such a small investment that the transport cost would have mattered.

I’m still interested in letting something by the day, so I’ll keep on looking. I also really need to learn more of how letting by day works, so next time I’m in Abidjan I plan to stay in a number of let-by-day accommodations and talk to the agents and the owners to get a feeling for the market.  In the meantime online ads provide quite a lot of information.

The table below is from an ad for a studio and for a three room apartment in the Cocody Danga area, from someone who seems to know the property market in Abidjan quite well:

Period Length of stay
3-room apartment
Studio
Electricity included
High Season July and August
Per Month 500 000 450 000 150 KW
Per Week 190 000 175 000 40 KW
Per Day 30 000 30 000 7 KW
Per Day beyond 1 month 20 000 20 000 7 KW
Mid
Season
December, January, June, September Per Month 450 000 400 000 150 KW
Per Week 165 000 150 000 40 KW
Per Day 25 000 22 000 7 KW
Per Day beyond 1 month 15 000 15 000 7 KW
Low Season February, Mars, April, May, October, November Per Month 400 000 350 000 150 KW
Per Week 150 000 125 000 40 KW
Per Day 15 000 15 000 7 KW
Per Day beyond 1 month 10 000 10 000 7 KW

100 F CFA will be charged for each KW consumed beyond the included amount.
A reimbursable deposit of 75 000 F CFA will be charged at the beginning of the stay.


Interesting here are the seasonal price differences (guess the French holidays have a big impact), the way to handle the electricity (aside the fact that it has to be KWh instead of KW), and the overall quite low prices for an attractive area. I may be wrong, but looking at the let-by-day offers online, I have the feeling that there are more offers now, than say six months ago, and that prices have gone down.

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Responses

  1. I am very surprised at the prices, anmd would like to exchange with you “off blog” on the matter !!


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