After the political instability that rocked the country in 2018 which affected the economy, the real estate industry in Kenya will experience major changes in 2019 if things play out as per our predictions. These changes can be attributed to the growth of middle-class income earners, a 4.3% annual urbanization rate against the average global rate of 2.0% and other demographical factors.
Developers and agents who want to succeed should take advantage of certain factors like an increase in the number of people using online platforms such as BuyRentKenya.com, adapting to changes in the market prices, building vertically in high demand areas and being aligned with the affordable housing project by the President.
Consumers Using Online Platforms
BuyRentKenya which has won numerous awards in real estate released market insights that show 68% of people look for property through their mobile phones. This makes the process of house hunting easier and removes the hustle of frequently visiting a property to view it, speak to a broker or the owner.
When searching for property, people expect to get full descriptions and prices. They want to be able to make inquiries all from the convenience of their phones. Therefore, developers and agents should advertise their listings on property portals like BuyRentKenya.com which will expose them to property seekers with different budgets and specific preferences.
Changes in Market Prices
Property prices in Kenya have changed in the last three years as seen in the market pricing review done by BuyRentKenya because of the key drivers in the economy and other trends in real estate. Demand has been on the rise in satellite towns such as Kitengela, which witnessed a 3% increase in apartment rental prices and 11% for townhouses in the exact location. People are moving away from Nairobi where property prices are high and opting to live in satellite towns thanks to the improvement in the road network which makes it easy to commute to the city centre.
In top suburbs such as Lavington and Westlands, the rental price of an apartment continues to grow from a high demand for property because of people with more disposable income who want to stay in the city. More multinational companies are setting up shop in these suburbs which increases demand for expatriates who want to live in these areas.
Developers Should Building Vertically
Because there is no more readily available land to construct in Nairobi, land prices are on the rise. For instance, townhouse rental prices in Parklands and Westlands have shot up by 11% and 17% respectively which has brought about demand for townhouses in satellite towns such as Athi River, Ruiru and Kitengela.
Developers who build vertically can provide housing solutions to people who want to reside in Nairobi due to various reasons. They can demolish old houses in high-demand areas in Nairobi and put up apartment blocks which will maximise their returns and help them leverage on the air rights in the Kilimani Neighbourhood Guide.
President’s Big Four Agenda Project
The pricing review from BuyRentKenya will help people know the property prices in different locations in Kenya and help investors make the right investments. However, external factors play a role in the changes in property market prices like one of the President’s “Big Four Agenda”, the affordable housing project.
The CEO of BuyRentKenya, Lizzie Costabir thinks that the project will bring positive changes to industries in real estate like cement that will see a drop in the cost of construction from partnerships with the government. “It will also bring increased Foreign Direct Investment (FDI) which “…has continually brought about an increase in urbanisation and subsequently increased property demand.” said Lizzy.
Agents and developers continue to find it hard to sell their property to the right people, while property seekers struggle to find property that fits their budget and preference. Online marketplaces like BuyRentKenya connects agents and developers to property seekers making it easier for all the involved parties to benefit.