Residential properties in upmarket Nairobi is failing to attract and retain clients as tenants look for cheaper option in the satellite towns, this is according to a new research conducted by property firm Hass Consult.
With fewer job prospects and layoffs, Tenants are becoming conscious and willing to save whatever they can rather than live in high rent areas of Nairobi.
The company was releasing the Hass Property Index for the third quarter.
“Asking rents for a modern apartment may cost as little as Sh23,400 and this bodes well for many tenants who are now preferring affordable units as they take caution to save in the wake of job losses across all sectors,” said HassConsult Head of Research Sakina Hassanali.
The lower middle class prefers to pay slightly more in transport than in rents and that’s why more and more people that rented high end apartments in Nairobi are moving to satellite towns surrounding Nairobi.
The report says, “Satellite towns with newly finished modern units, but with more affordable asking prices, are a favourite for bargain hunters, who led to increased asking prices for rents in Thika, Limuru, Mlolongo, Tigoni, Ongata Rongai, Kitengela and Ruaka metropolis between July and September,”.
Hassanali said high-end residential developments were losing business to the low-end ones due to price dynamics.
The data shows the average value of a house in Nairobi went up from Sh7.1 million in December 2000 to Sh31.2 million in September 2019. The average value for a 4-6 bedroom property is currently Sh39.1 million, while the average value for a 1-3 bedroom house is currently Sh14.4 million.
The study further shows apartments are the most rented property.
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