The HassConsult Q3 2024 Property Index reveals that property sales prices remained largely stagnant, with an overall growth of 0.7% quarter-on-quarter. However, the rental market saw a 0.6% correction after a period of sustained gains, reflecting the impact of economic uncertainty during recent months.
Sales prices across Nairobi’s suburbs and satellite towns registered minimal changes compared to the 1.0% growth recorded in Q2. Apartments, which constitute 67.7% of total advertised stock, reported price declines in both city suburbs and satellite towns, as oversupply continues to weigh down prices.
Similarly, rental prices declined by 0.6% over the quarter, following strong growth in the first half of 2024. This trend aligns with prevailing economic challenges, including nationwide protests in June and July, which dampened market activity and reduced tenant demand.
- Apartments: The segment struggled the most, with negative price movements in seven out of nine suburbs and six out of nine satellite towns. Kitengela apartments, for instance, saw prices fall by 3.6% over the quarter.
- Detached and Semi-Detached Houses: These units fared better, reflecting increased demand from homebuyers seeking more spacious housing.
- Top Performing Markets: Juja led in sales price growth, posting a 3.5% increase in Q3. Houses in Kitengela recorded the highest annual increase in rental prices at 18.1%.
The construction sector’s GDP performance further reflects this slowdown, having contracted by 2.9% in Q2 2024, compared to 2.7% growth in the same period in 2023.
Sakina Hassanali, Head of Development Consulting and Research at HassConsult, commented on the outlook:
“The rental market eased after a period of growth between October 2023 and June 2024, where monthly rental prices increased by 3% on average. As inflation subsides and interest rates fall, we anticipate a gradual recovery in both the sales and rental segments in the coming months.”
The report suggests that lower interest rates could boost consumer purchasing power, encouraging more property transactions and stabilizing the rental market.
Despite challenges, the Q3 2024 Hass Property Index indicates signs of resilience in the real estate market. The high supply of apartments continues to exert downward pressure on prices, but detached and semi-detached houses remain in demand. As the economic environment improves, both rental and sales markets are expected to gain momentum, providing opportunities for investors and homeowners alike.
