, NAIROBI, Kenya, Jan 23 – Rent prices continued to soar in the final months of 2013 driven by significant over demand for rentals according to the latest annual housing report by HassConsult.
The firm reports that rents rose by 8.5 percent in 2013 compared to 2012 with the average rent for a property going up to Sh120,372 in December 2013.
HassConsult Head of Marketing and Research says high mortgage rates are hindering the middle class transition from renting to purchasing.
“For the country’s expanding middle class, the path of progressing from renting to purchasing is being blocked now for the third time running by the nations exceptionally high mortgage rates,” Hassanali said.
Hassanali says that first time buyers of apartments and low end town houses are continuing to find mortgages unaffordable creating a high demand in rentals.
Semi detached rents that include townhouses and maisonettes that are terraced went up all year (2013) rising by 4.5 percent in the fourth quarter compared to third quarter and by 19.4 percent compared to 2012.
Apartments also went up went up by 4.2 percent in the fourth quarter compared to the third quarter and rose by 2.2 percent in 2013 compared to 2012.
In property sales, prices of town houses rose from October to December, up by 0.6 percent compared to the previous three months while prices for detached houses and apartments fell by 1.3 percent during the same period.
The average rent for a 4-6 bedroom property is currently at Sh183, 899 while the average rent for a 1-3 bedroom property is currently at Sh67,651.
Property values in the country have increased by 3.37 times since 2000 as the average value of property has gone up from Sh7.1 million in 2000 to Sh24.2 million in December 2013.
Property value of detached houses that include stand alone houses, bungalows, cottages and villas (either on their own plot or in a gated community) have increased by 0.5 percent compared to last year with the average house currently at Sh34.7 million up from Sh8.8 million in December 2000.
Semi detached houses property value have increased by 0.1 percent compared to last year while property value for apartments falling by 0.2 percent compared to last year with the average price currently at Sh12.2 million.
In 2013 apartments took up 45.3 percent of the market while semi detached took up 20 percent of the market and detached houses took up 25.7 percent of the market.
Areas of intense property development and economic expansion continue to experience rise in house prices.