Land prices in Nairobi’s satellite towns witnessed sluggish growth in Q4’2020, at 0.4% Quarter Over Quarter (Q/Q) with Kiambu County being the most affected.
Year Over Year (Y/Y) growth witnessed the biggest drop of 1.1% in 2020 compared to a 6.9% rise in 2019 according to Data from real estate research firm HassConsult.
Kiambu Town, Ruiru and Limuru witnessed the biggest annual drops of 11.4%, 6%, and 3% respectively after years of speculative land buying activity backed by massive infrastructure upgrades.
“Kiambu County has in the last decade seen the most intense development in infrastructure… attracting institutional investors such as insurance companies, SACCOs and real estate developers who bought large parcels of land,” said Ms. Sakina Hassanali, Head of Development Consulting and Research at HassConsult.
Tigoni was the only recorded suburb in Kiambu county that registered a 1.9% land price increase, on account of very recent infrastructure upgrades and stringent land-use laws in the area.
“Land prices in the county are moving towards a maximum of what the development market can bear until we see a hike economic activity and therefore some space for property prices to rise further,” Ms. Sakina added.
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On the other hand, land prices in Nairobi’s suburbs remained stagnant during the quarter and declined y/y by 2.6% in 2020 compared to a 1.7% y/y rise in 2019.
A reversal of 11 consecutive months of price drops.
Over 2020, land prices in Nairobi fell 2.56% compared to a 1.69% rise in 2019.
The highest annual price falls in land value was experienced in Parklands at 7.35% over 2020 followed by Riverside at 7.2% both apartment-dominated suburbs.
”Until we see a revival of the apartment market which at the end of the day is a function of economic growth, land prices in the inner city will continue to remain stagnant,” Hassanali said.