Property prices in Nairobi and surrounding areas increased by 5.2% in 2024.
Property prices in Nairobi and its environs grew at 5.2 per cent in 2024, doubling the 2.5 per cent rate of growth of 2023 on rising demand for standalone units whose supply has declined relative to apartments.
A survey done by real estate firm HassConsult shows that Juja, Ridgeways and Loresho led in house price growth in Nairobi at 12.9 per cent, 12.5 per cent and 11.6 per cent respectively in the year to December.
Detached house prices grew by 7.5 per cent in the year, outpacing apartments and semi-detached houses, whose price expansion stood at 1.6 per cent and 0.8 per cent respectively.
HassConsult attributed the higher growth pace of the standalone houses to their lower supply compared to the other two property types. In December 2024, detached houses accounted for 7.2 per cent of the property market, compared to 22.9 per cent for semi-detached units and 69.9 per cent for apartments.
Ten years ago, detached units accounted for 32.7 per cent of the market, semi-detached units took up 21.9 per cent while apartments accounted for 45.4 per cent.
“Detached units performed strongly due to their limited supply relative to other property types. In contrast, the increasing availability of multi-dweller units such as apartments has slowed their price growth,” said HassConsult head of development consulting and research Sakina Hassanali.
On average, the price of a property in Nairobi stood at Sh36.7 million by the end of December—with a four to six-bedroom property averaging Sh40.6 million and a one to three-bedroom property at an average of Sh13 million.
On the rental market, prices for all property in the city contracted by a marginal -0.02 per cent for 2024, highlighting the inability of landlords to raise rents amid tough economic conditions.
Rental prices had gone up by 2.5 per cent the previous year.
The depressed rental returns watered down the overall yield from property in the period, trailing other competing asset classes in the economy, such as government securities and equities.
“Despite these positive trends, property returns for 2024, comprising capital gains and rental yields, remained below returns from other asset classes. Yields stood at 7.2 percent in suburbs and five percent in satellite towns, compared to Treasury bill interest rates of between 9.5 and 11 percent,” added Ms Hassanali.
The average rental price for a property stood at Sh167,704 across the 14 suburbs and 10 satellite towns surveyed by HassConsult.
Four to six-bedroom houses commanded asking prices of Sh237,107 on average, while one to three-bedroom properties had an asking price of Sh92,377.
