Real estate in the month of July saw an overall increased activity in the residential sector and retail sectors, while the commercial office sector and other themes remained sluggish.
During the month, activity in the residential sector was mostly focused on the Affordable Housing Initiative (AHI) with Cytonn Investment’s handover ceremony of Phase 1 of The Alma taking the spotlight.
Another activity that developed in the residential sector worth mentioning is when Stima Investment Cooperative was appointed as the lead sales agent of Pangani Heights, one of the seven Nairobi Urban Regeneration Projects under the affordable housing initiative. You can read more on that here.
Despite improvement in activity, residential property sale prices recorded a 3.0 percent quarter over quarter (q/q) decline in Q2 of 2019, attributable to the slow economic growth during the period.
On the rental index, rents recorded a 1.9 percent q/q drop with detached units and semi-detached units recording a 3.2 and 1.6 percent q/q decline, respectively, while apartments recorded a q/q rental price appreciation of 0.4 percent attributable to the decline in demand for maisonettes and bungalows, in the wake of a growing need for affordability.
Kenya’s retail sector was vibrant during the month, attracting interest from the renowned international retailers as well as the robust expansion of local retailers.
One major development that took place in the retail sector was the opening of Game Stores’ third outlet in Kenya and its first outside Nairobi, at the Kisumu Mega City Mall. Find out more on this development here.
In the land sector, land prices in the Nairobi suburbs recorded a marginal q/q increase of 0.6 and a 1.7 percent annual appreciation, while land in satellite towns recorded a significant 3.2 percent q/q and 4.2 percent annual appreciation.
The growth in satellite towns is attributed to strong demand due to the affordability of land especially in areas with land prices of 15 million shillings and below per acre.