HassConsult: Nairobi Land Prices in Satellite towns at slow Pace

HassConsult released the Hass Land price indices for the fourth quarter of 2024, showing that land prices in Nairobi’s satellite towns grew at the slowest pace since June 2023 as a tough economic environment stifled demand.

The average cost of an acre of land satellite towns rose by 1.9 percent in the period, down from 3.02 percent in the previous quarter and the slowest rate of expansion since the 1.22 percent seen six quarters ago.

Nine out of the 14 towns tracked recorded a deceleration in price expansion, led by Thika and Mlolongo where growth fell from 6.3 percent and 6.6 percent in the third quarter to 0.9 percent and 1.1 percent, respectively, in the fourth quarter.

Kiambu (-0.3) and Ngong (-0.2 percent) recorded negative growth, while notable declines were also seen in Ruiru (4.9 to 3.2 percent), Syokimau (4.8 to 3.4 percent) and Kiserian (4.7 to 2.0 percent).

Satellite towns have in previous quarters seen impressive growth driven by both private and commercial property developers, but a tough economy which came with job losses, and high interest rates have impacted would be land buyers.

“Periods of economic uncertainty and slowing GDP growth can lead to some developers putting off decisions to acquire
land, thus reducing demand which drives prices higher,” said Ms. Sakina Hassanali, Head of Development Consulting and Research at HassConsult.

“It also shows that the infrastructure-led price boost in areas such as Thika, Kiserian, Mlolongo, and Syokimau is
starting to wane, given the sharp price jumps of previous quarters.”
The increase in prices in the suburbs remained steady at 1.7 percent, compared to an increase of 1.6 percent in the third quarter.
Suburb price gains were led by Parklands (3.4 percent), Upperhill (3.3 percent), Spring Valley (3.1 percent), and Kileleshwa (3.0 percent).

Land prices in the Nairobi satellite towns expanded by 1.9 percent in the fourth quarter, the slowest margin since June
2023.
· Economic challenges and high interest rates impacted the ability of developers to finance land purchases.
· Thika and Mlolongo had the biggest price growth decline, going from 6.3 percent and 6.6 percent in the third quarter to
0.9 percent and 1.1 percent respectively in the fourth quarter.
· Prices in Nairobi’s suburbs grew by 1.7 percent in the fourth quarter of 2024, slightly higher compared to quarter three’s growth of 1.6 percent .
·Parklands (3.4 percent), Upperhill (3.3 percent), Spring Valley (3.1 percent) and Kileleshwa (3.0 percent) led in price appreciation in the period.

• The Nairobi Suburbs-18 Land Index is representative of Land for Sale in Nairobi covering 18 highest activity suburbs.
• Land values have increased by 7.08 fold since December 2007.

• The annual average is representative of the average price of land for sale in Nairobi covering 18 highest activity suburbs.
• The average value for land has gone from 30.3 million in December 2007 to 214.2 million in December 2024.