Nairobi’s six most sought after satellite towns post double-digit land price growth

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Economy

Tuesday February 06 2024

Kitengela is 1 of Nairobi’s outer towns wherever request for onshore is high. FILE PHOTO | NMG

Land prices successful six outer towns astir Nairobi roseate by double digits past year, giving holders an yearly return that matched those connected high-yielding authorities bonds that were nan preferred action for investors successful a difficult finance market.

New onshore value information compiled by realtor HassConsult shows that nan value of an acre successful Ngong appreciated by 21.4 percent successful 2023 to Sh35 million, while successful Thika, an acre roseate by 17.8 percent to Sh27.2 million. In Syokimau, nan value of an acre of onshore appreciated 15.8 percent to Sh32.7 cardinal successful 2023.

Three different towns, Mlolongo, Kitengela, and Athi River, recorded value increases of betwixt 10.5 and 10.9 percent successful nan year.

In comparison, authorities bonds issued successful 2023 paid investors betwixt 12.9 and 18 percent successful interest, while nan one-year Treasury measure output ranged betwixt 10.4 and 15.9 percent.

Read: Ngong upsets Syokimau successful database of pricey outer towns

Equities meantime had a antagonistic return, partially connected relationship of overseas investor formation to Western markets and a weakening shilling that exposed dollar investors to speech losses.

The Nairobi Securities Exchange (NSE) shed Sh554 cardinal aliases 28 percent of its investor wealthiness successful 2023.

The outer towns person complete nan past fewer years recorded higher request for land—and, therefore, higher prices— connected nan backmost of easier entree that has made them an perfect extremity for middle-class Kenyans looking to build their ain homes connected affordable onshore without losing nan convenience of entree to nan city.

The highest returning outer towns, which had antecedently been shunned by nan mediate people owed to difficulties successful access, person benefited from awesome roadworthy useful carried retired successful nan past decade.

The useful see upgrades to main arteries specified arsenic Mombasa Road, Thika Road, and Ngong Road, arsenic good arsenic interconnecting roads betwixt nan towns themselves.

“Satellite towns that are served by amended entree infrastructure on nan Thika Road, Mombasa Road, and Ngong Road arteries continued pinch their dependable value maturation connected some quarterly and yearly basis,” said Sakina Hassanali, HassConsult’s caput of improvement consulting and research.

“Growth of onshore prices successful outer towns continues to outpace that of suburbs connected higher request arsenic nan costs per acre is wrong scope of much commercialized and backstage developers.”

In nan city’s suburbs, onshore prices besides recorded important betterment past year, moreover though nan precocious value period per acre meant that location was constricted room for costs maturation successful respective areas.

The HassConsult information shows that prices successful nan past 4th of nan twelvemonth went up by 3.3 percent, nan fastest gait of maturation successful 9 years, while nan yearly maturation stood astatine 3.96 percent.

Fourteen retired of nan 18 suburbs recorded affirmative value activity successful nan quarter, led by Muthaiga, Ridgeways, and Loresho, whose maturation complaint stood astatine 3.7 percent, 3.6 percent, and 3.1 percent, respectively.

On an yearly basis, Loresho led nan suburbs astatine 11 percent, followed by Lang’ata and Spring Valley astatine 10.9 percent and 10 percent, respectively.

“Instructively also, nan mean value per acre successful nan suburbs has now crossed nan Sh200-million mark, helped by nan accelerated emergence of prices successful areas specified arsenic Lang’ata, Ridgeways, Loresho, Muthangari which connection a operation of affordability, easiness of access, and mixed-use zoning,” said Ms Hassanali.

The city’s costliest onshore was recovered successful Upper Hill, Westlands, Parklands, and Kilimani, wherever an acre sells for much than Sh400 million.

Upper Hill saw its value per acre driblet by 2.6 percent past twelvemonth to Sh478.2 million, reflecting reduced request for commercialized agency space.

Read: Runda, Spring Valley trim location prices 10pc arsenic buyers fly to outer towns

In Westlands, nan value of an acre roseate by 1.6 percent to Sh456.7 million, while Kilimani and Parklands saw value increases of 1 percent and 0.6 percent to Sh406.2 cardinal and Sh402.3 million, respectively.

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