Real Estate Records Increased Activity in the Residential Sector in May

By Rahab Mbiriti / June 3, 2019 | 6:33 am




During the month of May, the real estate sector saw an overall increased activity in the residential sector, while the commercial office and hospitality sectors remained sluggish.

According to Cytonn Investments’ monthly report, in terms of market uptake, apartments accounted for 62.6 percent of all residential market’s uptake in Q1’2019, followed by maisonettes and bungalows at 23.4 percent and 12.0 percent, respectively.

Apartments, however, recorded 13.7 percent points decline from 76.3 percent in Q4’2018, a sign of subdued market activity. The dominance of apartments is an indication that the housing market is predominantly in the middle-income segment of the population.

Buyers’ housing preferences were largely influenced by a number of bedrooms and bathrooms, with the location being a key determinant in pricing.

“In line with our Cytonn Q1’2019 Markets Review, we expect the residential market to continue recording modest performance due to factors such as off-take financing, which continues to be elusive for home buyers, as well as insufficient credit advancement to developers” read the report.

Commercial Sector

The commercial office sector recorded minimal activity largely attributable to the tough economic environment especially as developers continue to experience constrained access to credit.

Read Also: Equities in May Fall but Regains Positive Performance in Week 1 of June

This is evidenced by relatively low private sector lending which currently stands at 4.9 percent, and the office space oversupply which came in at 5.2 million SQFT in 2019 according to Cytonn’s Nairobi Metropolitan Area Office Report 2019, resulting in declined building activity.

However, during the month, Japanese multinational firm, Toshiba, launched its first office in Nairobi at Regus Office Park Westlands.

This marks its second branch in Africa, after South Africa, reaffirming Kenya’s attractiveness and as a regional hub, a factor that has been attracting multinational firms keen on accessing the Eastern and Central Africa markets.

Retail Sector

The retail sector also remained largely dormant but for international food chain Burger King’s newly opened branch in Lavington at Shell Petrol Station, indicating foreign retailers’ interest in growing their local footprint in a bid to tap into the Country’s growing middle class.

“We expect the commercial sector to remain sluggish particularly in regards to construction activity, owing to reduced business activity in terms of expansion plans, across the country largely due to tight economic conditions and the ongoing oversupply. However, the sector’s performance will be cushioned by the continued interest from foreign players.” the report noted.

Read Also: May in Focus: T-Bills Registered an Overall Under-subscription





About Rahab Mbiriti

Rahab Mbiriti is an Experienced Research Specialist working for Sokodirectory with a passion for collecting data, breaking down data and analyzing it for easy consumption. Rahab also has a passion for writing Business and Economic oriented articles.To reach her, email her on rahab@sokodirectory.com

View other posts by Rahab Mbiriti


More Articles From This Author







Trending Stories










Other Related Articles










SOKO DIRECTORY & FINANCIAL GUIDE



ARCHIVES

2020
  • January 2020 (272)
  • February 2020 (310)
  • March 2020 (390)
  • April 2020 (321)
  • May 2020 (335)
  • June 2020 (327)
  • July 2020 (334)
  • August 2020 (276)
  • September 2020 (202)
  • 2019
  • January 2019 (253)
  • February 2019 (216)
  • March 2019 (285)
  • April 2019 (254)
  • May 2019 (272)
  • June 2019 (251)
  • July 2019 (338)
  • August 2019 (293)
  • September 2019 (306)
  • October 2019 (313)
  • November 2019 (362)
  • December 2019 (319)
  • 2018
  • January 2018 (291)
  • February 2018 (213)
  • March 2018 (278)
  • April 2018 (225)
  • May 2018 (238)
  • June 2018 (178)
  • July 2018 (256)
  • August 2018 (249)
  • September 2018 (256)
  • October 2018 (287)
  • November 2018 (284)
  • December 2018 (185)
  • 2017
  • January 2017 (183)
  • February 2017 (194)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (205)
  • July 2017 (190)
  • August 2017 (195)
  • September 2017 (186)
  • October 2017 (235)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (165)
  • February 2016 (165)
  • March 2016 (190)
  • April 2016 (143)
  • May 2016 (245)
  • June 2016 (182)
  • July 2016 (271)
  • August 2016 (248)
  • September 2016 (234)
  • October 2016 (191)
  • November 2016 (243)
  • December 2016 (153)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (166)
  • April 2015 (108)
  • May 2015 (116)
  • June 2015 (120)
  • July 2015 (148)
  • August 2015 (157)
  • September 2015 (188)
  • October 2015 (169)
  • November 2015 (173)
  • December 2015 (207)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950