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Lang’ata property market boosted by affordability: data

NAIROBI, Kenya, Aug 21Asking prices for property remained stagnant at a negligible 0.1 percent drop for the second quarter of 2021, a new data reveals.

The data by Hass consult shows that this led to the property market witnessing a static sales price-performance, driven by the oversupplied apartment market in Kilimani and Kileleshwa, down 9.5 percent and 6.9 percent respectively in the last year.

While most suburbs in and out of Nairobi reported somewhat mild movements, both up and down, houses in Lang’ata posted a typical property price movements of an increase of 4.1 percent in the quarter and 10.3 percent in the year, in a market that is currently driven by affordability.

Lang’ata registered the cheapest price point for city houses at Sh34.5million.

“At a time when economic stagnation has largely riddled the middle market with salary cuts, unemployment and small business burnout, properties with lower ticket prices but still within the city are becoming an attractive investment.’ said Sakina Hassanali, Head of Development Consulting and Research at HassConsult.

At the same time, apartments in this suburb that average a price of Sh11.2 million, which is almost half the city’s average, also registered a 4.4 percent annual growth, twice the growth rate of the next best suburb, Lavington.

On the rental front there was a mild improvement of 1.1 percent over the quarter as the market slowly shows moves to recovery.

This was heavily backed by the increase in rental prices of detached houses up 3.4 percent in the quarter, symptomatic of the people within large international and multinational organizations who continue working from home and whose elimination of mobility costs have enabled higher housing budgets.

However, affordability still appears to be driving the apartment rental market.

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In the period under review, Riverside Drive, a suburb that registers the highest apartment rents at an average of Sh170,200, saw the highest rent price corrections at a loss of 2.8 percent in the quarter, while Langata, whose average apartment rents are half the next best option registered a 2.9 percent increase over the quarter and 12.9 percent over the year.

 

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