Effects of the Covid-19 pandemic have been evident in the economy with Nairobi's rental market reporting a decline over the past few months as a number of landlords reduced rent prices.
According to the Hass Property Index for Quarter 2, 2020, Donholm estate recorded the biggest quarterly drop in rent at 4.8% while on an annual basis Kitisuru led the pack with rents reducing by 7.7%.
Other estates that recorded a dip in rental prices for the past months were Gigiri (- 2.9%), Ridgeways (-2.9%), Lang'ata (-2.3%), Kileleshwa (-1.2%), Kitisuru (-1.5%), Nyari (-1.6%) and Lavington (-1.3%).
In satellite towns, Mlolongo led the pack with apartment rents falling by 2.6% over the quarter and 9.8% compared to last year, while Kiserian and Thika saw gains of 6.7% and 10% over the quarter and year respectively.
On the other hand, apartment rental prices in Parklands suburbs marginally increased by 2.4 percent over the quarter and 7.1 percent over the year.
The real estate firm observed that tenants were increasingly asking for discounts citing reduced incomes due to the Covid-19 pandemic.
Over the last quarter, 47 percent of the tenants surveyed asked their landlords for rent discounts of between 25 and 30 percent.
“Covid-19 has resulted in the closure of many industries across the economy and thereby reducing incomes of business owners and employees who are in turn exerting pressure on landlords to reduce rents,” Head of Development Consulting and Research at HassConsult, Sakina Hassanali stated.
Overall prices dropped by 0.2% over the quarter bringing the annual increase on all properties to just 2.9%.
As for house prices, units in Muthaiga recorded the highest asking prices over the quarter at 3.6% while Riverside recorded the lowest drop with apartment prices marginally reducing by 2.6%.
Rental prices in Kenya had increased by 3.98 fold since 2001 as of December 2019, apartments took up 63.2% of the market, semi-detached houses took up 24.5% of the market and detached houses took up 12.3% of the market.
Additionally, the average rental for a property had gone from Ksh 38,516 in December 2000 to Ksh 153,447 in June 2020.
The report quoted the average rent for a 4-6 bedroom property at Ksh 232,258 with a 1-3 bedroom property rent at Ksh 83,369.
