NAIROBI, Kenya, Sep 5- If you have ever wanted to live in Kileleshwa, Lavington, Loresho or Westlands, but high rent rates were hindering you, the time could be now.
A study by Knight Frank reveals that rent rates in the areas reduced in the first half of 2019 owing to an oversupply of high-end developments in some locations.
Knight Frank’s Kenya Market Update shows prime residential prices fell by 1.8 percent over the period, increasing the decline to 6.7 percent in the year to June.
“These factors have transformed the market in favor of buyers and tenants, which has been exacerbated by multinationals continuing to downsize whilst there are fewer expatriates relocating to Kenya, impacting negatively on the niche market,” the report notes.
Capital business spoke to Anne Wambui, a resident of Lavington for the past 15 years who says the rent in the area of a one-bedroom has reduced to Sh55,000.
“When I moved to this region the rent for just a one-bedroom would cost Sh75,000 and as the days go by, we have seen the price reduced,” she said.
Her sentiments were backed up by an agent working with Azizi realtors, who requested anonymity saying that the landlords want to create a balance.
“ We are experiencing tough economic times and what owners want to do is maintain their tenants, for instance, a one-bedroom now costs Sh55,000, a two-bedroom has now reduced from Sh120,000 to Sh105,000 whilst a three-bedroom in this area now costs Sh125,000 from Sh140,000,” she said.
Reginald Kariuki has been camping in Loresho for five years now. He lives in a Sh170,000 three-bedroom house.
It surprises him that the price has gone down and he believes it can go lower than that.
“I am now paying Sh150,000 and I am confident the landlord can make it go lower because now we can negotiate. Nobody would want to leave such a big house empty, it would look bad on him,” he said.
Westlands area has equally joined the bandwagon though not much affected.
A landlord will only negotiate a price reduction of Sh5000, boasting the tight security experienced in the area.
“Westlands is surrounded by malls that are heavily guarded, and this is where we also find civilian policemen patrolling the area round the clock,” Maryanne Gitong’a, an agent working in the area said.
However, the script is different in Ruaka, where low and middle-income earners are rushing to.
According to Haron Ochieng, an agent based in Ruaka, the price in the area will scale much higher soon.
“This has the new comfortable area in Nairobi and as we continue witnessing the mass exodus from other estates to Ruaka, the rent will definitely go up,” he says.
According to a report by Cytonn Real Estate, Ruaka in Kiambu registered an eight percent yield in the second quarter of 2019, the highest recorded return for Nairobi Metropolitan rental apartments.
The satellite town recorded a 91.9 percent occupancy rate with sales realized standing at Sh98,098 per square metre and rental price per square metre at Sh454.
The area is served by the Northern Bypass, and the upcoming Western Expressway while the Northern Bypass is also earmarked for expansion into a dual carriageway.
It has also attracted massive multi-billion investments in malls including the Two Rivers Mall, residential developments and factories giving it the new impetus for growth.