Nairobi Estates That Recorded Highest Rental Increase in 2020

  • Joyland shopping center in Ruaka. December 21, 2020.
    Joyland shopping center in Ruaka. December 21, 2020.
    File
    Eddy Mwanza
  • Several estates in Nairobi and it's environs witnessed a surge in rental prices in 2020, with some witnessing a 2 fold increase despite the pandemic.

    Kenyans.co.ke analysed the Hass Rental Index reports dating back 5 years which paints a picture of a sharp increase in rent.

    The Hass Rental Index is used to measure the asking price changes of residential lettings nationwide throughout Kenya serving as an indicator of trends. It covers over 320 suburbs and towns across Kenya

    Housing has been one of Kenya’s fastest-growing sectors over the past decade, fuelled by heavy demand and returns.

    A block of apartments in Nairobi.
    A block of apartments in Nairobi.
    File

    Rental prices in the city have surged nearly three-fold since 2011.

    "The annual rental price uptick across all properties of 5.5 percent in the year was led strongly by the 7.3 rise in rental prices for detached houses in 2020,"  the 2020 Quarter 4 Hass Rental Index reads in part.

    Ongata Rongai witnessed the largest increase (3.4%) in rental prices during the last three months of 2020.

    A 2 bedroom apartment in this area currently demands an average of Ksh20,000 in monthly rent.

    In 2019, Ongata Rongai also witnessed the biggest rise in rental prices (8.1%).

    Notably, in 2019, Ngong was the town that witnessed the biggest increase (18.6%) in rental prices. A one-bedroom house in the area currently averages Ksh14,000 per month.

    The increase in demand for houses in Nairobi's satellite towns has been directly linked to the surge in rental prices.

    Back in 2016, the Hass Rental Index revealed that neighborhoods within Nairobi such as Lang'ata registered the highest increase (12.6%) in rental prices.

    However, the reports detail a common trend over the last 3 years involving Kenyans moving out of the capital city in large masses.

    Many Nairobi residents are ditching rented homes in city estates in favour of cheaper ones in the suburbs as the cost of living soars.

    Nairobians have now relocated to satellite towns like Ngong, Kitengela, Rongai, Ruai, and Ruiru, which have also not been spared rising rents due to the influx of new customers.

    A one-bedroom apartment in Ruaka currently averages at Ksh23,000 in monthly rent, a figure that is almost double what it was before 2016.

    The leafy suburbs in the Kenyan capital have also witnessed rental increases with a 1 bedroom furnished apartment in Riverside, Westlands going for Ksh130,000 t0  Ksh150,000 per month. 

    In Kileleshwa, a 2 bedroom apartment demands anything from Ksh80,000 to Ksh100,000 a month

    According to Kenyan law, building owners can increase rent above the cost of living measure if they make necessary upgrades to homes and office blocks.

    The government-backed Landlord and Tenant Bill of 2021 proposes that rent increases should not exceed the annual average inflation rate for the preceding year.

    Under the proposed law, the State is seeking to control rent prices for both commercial and residential property.

    "The Bill seeks to introduce a legal framework which balances the interests of landlords and tenants in a free market economy by ensuring that landlords earn reasonable income from their investment in housing and also protects the tenant," reads a section of the Bill tabled in Parliament by National Assembly Majority Leader, Amos Kimunya.

    In the proposed bill, building owners will be allowed to increase rent once a year for residential houses and once in two years for commercial premises, lowering the cost of doing business.

    National Assembly Majoirty Leader Amos Kimunya in Parliament on July 14, 2020.
    National Assembly Majority Leader Amos Kimunya in Parliament on July 14, 2020.
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