HassConsult has published its Hass Property Price Indices for the fourth quarter of 2024, offering insights into the shifting trends in Nairobi’s property market. The report highlights key distinctions between quarterly and annual property market performance.
Sales Price Trends
Quarterly sales prices in Nairobi’s suburbs and satellite towns showed a modest increase of 0.8 percent, up from 0.7 percent in the third quarter. On an annual basis, the growth rate was more significant, with sales prices increasing by 5.2 percent in 2024, a notable rise compared to the 2.5 percent growth recorded in 2023.
Detached houses were the standout performers, with prices growing by 1.5 percent quarter-on-quarter and 7.5 percent year-on-year. In contrast, semi-detached houses and apartments experienced price declines of 0.8 percent and 0.6 percent, respectively, in the fourth quarter, despite achieving annual gains of 0.8 percent and 1.6 percent.
“Detached units performed strongly both quarterly and annually 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,” explained Ms. Sakina Hassanali, Head of Development Consulting and Research at HassConsult.
Rental Market Dynamics
The rental market showed mixed signals. Asking rents rose by 0.2 percent in the fourth quarter, reversing a 0.6 percent decline in the third quarter. However, annual rental prices remained flat, with a marginal change of -0.02 percent in 2024, reflecting the economic challenges faced by landlords in raising rents.
Some areas demonstrated strong quarterly recoveries in rental prices. Gigiri and Juja led the way with increases of 6.7 percent and 6.4 percent, respectively. In the apartment segment, Ongata Rongai and Parklands recorded gains of 3.4 percent and 3.3 percent, respectively.
“The recovery in quarterly rental prices coincided with falling inflation, which improved tenants’ purchasing power and gave landlords room to adjust rents upwards,” noted Ms. Hassanali.
Suburban and Satellite Town Performance
In the suburban house segment, Ridgeways and Loresho recorded the highest annual price gains at 12.5 percent and 11.6 percent, respectively. Among satellite towns, Juja, Kiserian, and Ongata Rongai led with annual growth rates of 12.9 percent, 8.7 percent, and 8.1 percent.
Property Returns
Despite the positive trends in property prices, overall property returns for 2024 remained below those of other asset classes. Combining capital gains and rental yields, returns stood at 7.2 percent in Nairobi’s suburbs and 5.0 percent in satellite towns, falling short of the Treasury bill interest rates, which ranged between 9.5 and 11 percent.
