Developers have once again witnessed further drops in prices of land located in Nairobi and its outskirts.
A report by HassConsult released on Thursday, November 12, detailed that land prices dropped 0.94% in quarter three (July-September 2020), compared to a growth of 0.22% in a similar period last year.
The property development firm added that this is the third quarterly drop in a row on reduced demand despite efforts to revive the economy following the Covid-19 pandemic.
Land in satellite towns dropped by 0.06%. Riverside suburb recorded a drop in land prices at 3.82% on an annual basis while Parklands led the pack with prices reducing by 8.8%.
Outside Nairobi, Kiambu posted the biggest drops on both quarterly and annually at 5.2% and 7.97% respectively.
However, other areas recorded a sharp increase with developers rushing to build apartments due to the high demand for houses.
Upperhill has the most expensive land with an acre in the suburb going for Ksh 512 million.
In the satellite towns, Ruaka has the most expensive land at Ksh 89 million per acre and Rongai recorded the highest increase over both the quarter and on an annual basis at 4.71% and 10.3%, respectively.
Spring Valley registered a 3.55% increase over the quarter as the suburb continues to attract investors eyeing high-density use of land in the area.
“Spring Valley has traditionally been characterized by stand-alone units with ample space but, gradually we see the suburb open up to high-density use including apartment and office blocks,” said Sakina Hassanali, Head of Development Consulting and Research at HassConsult.
She added that while prices eased in the quarter, the marginal drop shows that land continues to show its stability over other asset classes.
“We have not seen a major drop in land values despite the challenges such as Covid-19 and the tough economic environment proving that investors still see this as the best bet over the long-term," the researcher stated.
The average value for land in Nairobi satellites has gone from Ksh 2.4 million in December 2007 to Ksh 21.9 million in September 2020. For suburbs, it has gone from Ksh 30.3 million to Ksh 188.9 million in the same period.
