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Real Estate Investment Trusts are regulated Collective Investment Schemes where their managers source funds to build or acquire real estate assets, which they sell or rent to generate income /FILE

Kenya

Nairobi metropolitan rental market trends on the rise

Mathenge attributes the rising rentals trend in these Nairobi metropolitan towns to various factors including, high walkability score, good access to public transport and the high number of open businesses/FILE

NAIROBI, Kenya, Oct 28 – Major towns in the outskirts of Nairobi City continue to experience a rising rental trend, according to latest report by Ritz Housing and Properties Limited.

The towns which include, Thika, Ruiru, Ongata Rongai, Ruaka and Kitengela, saw an average rental increase of 2.1 percent on the lower side and up to 26.5 percent on higher side, between quarter three of 2018 and same quarter in 2019.

The report covers between one bedroom to three-bedroom units.

Commenting on the report, Ritz Housing and Properties Managing Director Samuel Mathenge, attributes the rising rentals trend in these Nairobi metropolitan towns to various factors including, high walkability score, good access to public transport and the high number of open businesses.

In Kitengela, the monthly median rental price for a one-bedroomed house stood at Sh15, 000, an increase of 8.45 percent between the third quarter of 2018 and 2019. The monthly cost of two-bedroom house stood at approximately Sh25,000 an increase of 10 percent while three- bedroom house cost went up by approximately 5.40 percent to an average monthly median rental price of Sh39,000.

“The level of income of Kitengela residents does not support mortgaging thus making them opt to rent. Also, due to the rise of living standards, the number of rentals is on the raise thus making the market trend of Kitengela favorable,” Mathenge said.

“The rise in population requires increase in housing thus growth of rental market in Kitengela,” he added.

In Ongata Rongai, the monthly mean price of a one-bedroom rental stood at Kshs9,500. This was an increase of 2.15 percent between quarter three of 2018 quarter and same quarter 2019. For a Two-bedroom house, the mean monthly rental price was approximately Sh22,000 a 4.56 percent increase, while a three-bedroom house rent stood at Sh35,000, a 2.941 percent increase compared to the same quarter previous year.

In Thika Town, the monthly mean rental price for a one-bedroom house stood at Sh15,000 which was a 25 percent increase between the third quarter of 2018 and 2019. In the two-bedroomed rentals the monthly mean rental price was approximately Sh21,000, an increase of 5 percent compared to the previous quarter of 2017. While the three-bedroom rental prices stood at approximately Sh35,000, a 2.94 percent increase.

“Thika Town experienced a relatively steady rental price growth between July 2018 and July 2019, a rate slightly below other satellite towns within the Nairobi Metropolitan area,” Mathenge noted.

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In Ruiru, the monthly mean rental price for a one-bedroom house stood at Sh12,000. This was a 9.09 percent increase between the July quarter of 2018 and 2019. In the two-bedroom, the prices stood at approximately Sh18,000 which was an increase of 5.88 percent compared to the previous quarter of 2018. On the other hand, the three-bedroom rent stood at approximately Sh30,000, an increase of 15.38 percent compared to the previous quarter.

Last and not the least was Ruaka, where the monthly mean price of a one-bedroom rental stood at Sh24,000 which was an increase of 10.0 percent between the third 2018 quarter and 2019. In two-bedroom rentals in Ruaka, the mean monthly rental price stood at approximately Sh34, 000. This was an increase in 5.00 percent compared to the previous quarter. The three-bedroom houses rentals on the other hand stood at Sh48,000 which was an increase of 2.13 percent compared to the previous quarter.

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