Housing market moves into a renewed up-tick

HassConsult unveiled the results of its third quarter property price indices, which showed a take-off in asking prices for properties, a slowdown in rent rises, and a restoration of the high returns on investment in the local housing market.

“The market correction to rents that we flagged in 2011 – as property yields moved to lows of around 7%  – now appears to be reaching its conclusion and we are moving into a new period of take-off in sales prices and investment returns,” said Ms Sakina Hassanali, HassConsult’s Head of Research and Marketing.

House price inflation – which was particularly sharp in 2008 – saw yields on properties fall, as rents stagnated. By 2011, this had seen some slowing of demand for properties as shorter term investments, seeing house price rises slow down and rents begin to surge upwards.

“Rents rose by more than 30% in the 18 months from January 2012, in a steep and continuous upwards trend, but the growth has slowed during 2014, to just 0.4% in the third quarter,” said Ms Hassanali.

“While we see a likelihood of some further rent increases, we believe the market has substantially adjusted and that rents will now be more stable.”

At the same time, asking prices for properties, which had been almost static for apartments and detached houses, moved up significantly in the third quarter, by 3.6% and 3.2%, while semi-detached house prices also continued to rise, but more slowly, up 2.4 % on the previous quarter.


The Hass composite house price index is based on 4,000 to 6,000 property prices per quarter. Over the five years since its launch has tracked more than 100,000 house price records from across Kenya. The data, which captures asking prices, is collected from multiple estate agencies and all publically available housing sales, including in property magazines, on property websites and in the national media.

The composite index, launched at the beginning of 2010, followed the launch in 2009 of the Hass Property Index, based on HassConsult’s own closing prices on property sales. HassConsult has continued to gather and compute its own closing price index as an internal reference point, but only publishes the composite asking price index, which is based on now the largest real estate data set in Kenya.

The banks, which see valuations on mortgaged properties, typically handle, in total, some 600 house sales per quarter, which is the number of new mortgages currently issued in Kenya.

“We are delighted that our research team, with six full-time researchers and analysts and two senior consultants, has meticulously compiled such a significant data set, and we shall continue to develop our research base and reporting capabilities,” said Ms Hassanali.

In this vein, HassConsult last year began geo-mapping the use and land status of every land plot in Nairobi as an intensive primary research programme. It also collects and analyses all planning applications, and produces the annual State of Development report on the real estate sector.


It is now working to collect data on housing demand, looking at the profile of home buyers and housing investors, which it will shortly be releasing as the quarterly Home Ownership Report in partnership with The Property Show. 

Sign Up