Kenya’s real estate market remains stagnant in Q3

by Sharon Chepngetich October 8, 2019

written by Sharon Chepngetich October 8, 2019

Cytonn Real Estate, the development affiliate of Cytonn Investments, has released the Q3’2019 real estate market review, highlighting the performance of various sectors including the residential, commercial office, retail and land sectors.

According to the report, the real estate market performance remained largely stagnant in Q3’2019, with the residential sector yield remaining unchanged at 4.9 per cent, while commercial office and retail sectors recorded rental yields of 7.7 per cent and 8.0 per cent, respectively in Q3’2019, from 7.8 per cent and 8.2 per cent, respectively, in H1’2019.

The sector was mainly constrained by;

i) Delay in the processing of construction permits by some county governments,

ii) Oversupply in the commercial office and retail sectors with a surplus of 5.2 mn SQFT and 2.0 mn SQFT, respectively, as at 2018,

(iii) Slow private sector credit growth.

In the residential sector, Ruiru and Kilimani ranked best in terms of rental yields recording 6.1 per cent and 5.8 per cent, respectively:

No.	Residential Neighbourhood	Price per SQM (Kshs)	Rent per SQM (Kshs)	Occupancy	Rental Yield	Total Return
1	Ruiru – Detached	92,178	407	80.4%	6.10%	4.2%
2	Kilimani- Apartments	119,276	863	75.9%	5.80%	4.1%
3	Donholm & Komarock – Apartments	72,033	382	89.9%	5.80%	4.5%
4	Kileleshwa – Apartments	116,294	765	86.5%	5.70%	6.2%
5	Kitengela- Apartments	60,750	400	71.8%	5.70%	4.5%
6	Athi River – Detached	93,939	393	74.8%	5.50%	6.0%
7	Thika – Detached	66,778	458	79.4%	5.50%	5.2%
8	Upper Kabete – Apartments	80,883	447	82.0%	5.40%	5.2%
9	Rosslyn – Detached	164,377	848	83.3%	5.30%	5.3%
10	Parklands- Apartments	121,917	679	62.3%	5.30%	4.3%
11	Runda – Detached	229,183	1033	93.3%	5.10%	5.8%
12	Donholm/Komarock – Detached	87,571	342	98.0%	5.10%	5.2%
13	Thindigua –Apartments	94,083	472	90.8%	5.10%	4.7%
14	Ngong Road- Apartments	97,288	571	72.2%	5.00%	5.0%
15	Langata –Apartments	110,659	503	88.0%	5.00%	3.9%
16	Ruaka – Apartments	98,979	507	73.9%	4.90%	5.7%
17	Syokimau- Apartments	65,046	280	89.4%	4.90%	4.5%
18	Westlands – Apartments	145,299	806	75.5%	4.80%	5.8%
19	South B/C – Apartments	99,201	406	93.3%	4.70%	5.2%
20	Langata – Detached	137,755	675	93.1%	4.60%	5.2%
21	South B/C – Detached	106,460	421	95.7%	4.50%	4.1%
22	Syokimau/Mlolongo –Detached	74,211	306	83.0%	4.40%	5.4%
23	Loresho – Apartments	116,411	559	63.9%	4.40%	4.9%
24	Athi River –Apartments	62,423	369	74.3%	4.40%	5.0%
25	Karen – Detached	188,172	763	73.8%	4.20%	4.8%
26	Kitisuru – Detached	219,812	842	76.7%	4.20%	2.5%
27	Loresho – Detached	149,941	941	88.2%	4.20%	4.5%
28	Runda Mumwe –Detached	151,951	563	89.5%	4.10%	3.9%
29	Lavington –Detached	200,187	648	77.2%	3.70%	3.7%
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