Kileleshwa and Kilimani accounted for 45% of all properties on sale in Nairobi subburbs
Home prices in Nairobi’s suburbs remained flat in q4 of 2020 at 1.2% with a marginal annual rise of 0.17% according to HassConsult’s property pricing index.
The index attributes to a decline in prices for apartments by an average of 1.8% in the last quarter and 4.6% over the year. The Hass Property Index is used to measure the asking price changes of residential housing nationwide throughout Kenya serving as an indicator of trends.
According to the index, residential units in Kileleshwa and Kilimani accounted for 45% of all properties on sale, registered the biggest decline in the year by 9.9% and 8.6% respectively.
“We have seen the Kilimani and Kileleshwa markets move from steep price growth, in all ways a price boom, until it reached levels that buyers could no longer reach with the roadblocks in mortgage finance and reduced liquidity from a global pandemic,” said Sakina Hassanali, head of property development consulting and research at HassConsult.
“Against this backdrop, the loading of extra costs onto developers, as soaring land prices and sky-high finance costs, has served in shifting developers to create smaller apartments with lower price tags to allow buyers to continue to access their products at a price that works for both buyer and seller.”
However, with the continued supply of smaller apartments in the locations, it is expected the sector will be revived.
“While smaller apartments dominate the new build market in Kilimani and Kileleshwa and provide middle-income housing at lower ticket prices, the sheer volume of new stock created rental price vulnerability for larger and older stock during the economic slowdown caused by 2020’s global pandemic, resulting in rental price corrections.”
On residential rental prices grew by 1.1% in the quarter, despite a fall in apartment rents of 1.24% in the same period. Kilimani witnessed the biggest fall in quarterly rents at 4.0% followed by Kileleshwa, recording 2.6% over Q4.