Properties located in Nairobi’s outskirts posted a slight increase in prices compared to suburbs where prices fell according to the HassConsult Property Price Index.
Second quarter data by the realtor reveals that despite economic pressures, prices of properties in Nairobi’s satellite towns went up by an average of 2.1pc as prices of properties in the suburbs declined marginally by 0.9pc decrease in the suburbs.
“This rise in satellite towns can be attributed to accelerated urbanisation, which has bolstered demand and pushed up asking prices,” said the firm.
According to the firm despite high interest rates and a strengthened shilling impacting foreign buyer advantages, property sales prices have continued at moderate pace.
“While higher interest rates on mortgages don’t have a significant impact on market wide property price movements due to the low mortgage participation in the country, the rise in rates have the effect of reducing market liquidity in general resulting in a dampening of demand,” said Sakina Hassanali, Head of Development, Consulting, and Research at HassConsult.
Property prices in Juja rose the highest at 13.1pc year-on-year followed by Athi River, Ongata Rongai and Kitengela where prices shot up by 12pc, 10.4pc and 10.4pc respectively.
Lowest price increases were recorded in Kimbu, Limuru and Togoni where property prices went up by 3.7pc, 3.8pc and 3.9pc respectively.
“So far, the property market has shown resilience with price stability still being witnessed across most areas,” added Hassanali.
In Nairobi’s suburbs, highest increase in house prices was recorded for properties in Kilimani with a 9.3pc rise in asking price followed by Langata at 7.9pc, Nyari Estate 7.6pc and Loresho at 6.8pc.
HassConsult further says rental prices experienced a slight increase of 0.01pc in the quarter.
“Property owners are cautious about raising rents to retain tenants amid higher taxes and inflation, which has constrained disposable income,” the firm stated.
In the suburbs, the average rental yield increased to 7pc by the end of June from 6.9pc in March. On the other hand, rental yields in satellite towns declined slightly from 4.9pc in March to 4.8pc in June.
