14-seater matatu or building rentals: which one should I invest in?

Between buying a 14-seater matatu or building rentals: which one would you advice someone to go for?

When this question was asked, Kenyans came out in their numbers with various opinions. Indeed, this is one of the most divisive personal finance questions. One hand are Kenyans who believe that matatus are money makers and on the other hand are Kenyans who believe rentals are a better investment. But what reasons do they have for either of these two investment ventures?

Well, we sampled some of the opinions Kenyans gave on what is preferable and here are some of them:

A fairly good Toyota Hiace costs around 1.8m. You can buy it today and start earning immediately. In six months you’ll have enough money to buy a piece of land. On the other hand, building rentals worth 1.8m is a good idea but you can only manage to build three or four doors. The process of construction requires a lot of paperwork and time. By the time the houses are ready for tenancy, your friend who bought a matatu has enough money to start building. He can even take a loan against the logbook and in no time, he has a plot and a matatu. – Cleophas.

I had this discussion with an Ummoiner driver on my way to town. He’s been in the matatu industry for 33 years and he insists that he would do matatu any day though he prefers the akina Ummoiner type not Nissan. His argument was this, rentals hold a lot of your cash but the returns are kidogo sana. He says people who understand the industry well won’t tie down their cash in rentals. He even gave a breakdown of the revenue n expenditure. I was lost. – Nancy.

The capital requirements are not the same, also depends on how you view issues in matters investment….as a business lady, I prefer daily cash flows that I can manage and build long term investments, so I would go with the matatu. – Flo.

Rentals….matatu is an accident waiting to happen and the driver and tout is the one who benefits they will bring back mkebe. – Mary.

I would rather buy matatu, 5k per day accumulating 150k a month, tell me matatu bought with 1.5 million , which rentals can you built with this amount and give you 150k. – Jane.

It depends on many factors… for instance, do you have a family? do you have another source of income? Is it going to be a town service matatu or masafa? Can only advice once I have your answers to these questions. – Gachahi.

It depends with your patience. Otherwise all are profitable depending on your commitment. 5 million on rentals 40k monthly 5 million on matatu 70k monthly but matatu is doable – Jimmy.

Rental houses anytime, at least I don’t have to spend most of my time in the garage and monitoring the manambas and driv️ers. Quality time with my family too coz that’s my priority. – Risper.

Rental houses. They will always appreciate. With matatu you never know about the safety of the roads. Though some do well in matatus. – Marsse.

My grandma so rest her soul once told me gari inaeza kujengea lakini nyumba haiwezi itaingiana na mambo yako. Shortly, what that means is if you can properly manage the matatu it will build an empire rentals on the other hand being na budget always fixed utazoea income bila challenge na you will fix your costs to the income you receive thus stagnation. – Dennis.

READ MORE: Should I use my savings to buy 9l Hiace Matatu cash for long distance routes?

If you have the guts to manage matatus please go for it. Rentals are costly and may take ages to recover your initial capital. – Kem.

It depends on the cash at hand.you can buy a matatu with one million but you can’t build rental houses with one mita not unless iron build. – Mutiso.

Rentals…..they would be stationary unlike a vehicle. Considering g the wear and tear that comes with the vehicle, depreciation too and some mechanical hitches here and there. Plant that apartment and it will always appreciate you. – Nyambeki.

Payback period for a matatu is one year, for rental house is 10 years. It’s about risk and gain. Do your math. – Maurice.