As the country recovered from the aftermath of the pandemic, real estate reports indicated that land prices made significant gains in 2021.
Some Nairobi towns, both suburbs and satellites, have seen land prices grow significantly in the past year- with some showing a 7.18 per cent spike.
Land can be termed as one of the most prized asset as their returns over the past 12 months have been unmatched.
According to the 2021 Hass Property Index Quarter 3, affluent areas in Nairobi such as Kilimani, Gigiri, Loresho and Upper Hill recorded a drop in prices for an acre of land- the rest recorded a notable price increase.
During the first quarter of 2021, an acre of land in Karen was selling at Ksh62.8 million. As the year came to a close, the same acre of land was selling at Ksh64.4 million - indicating a Ksh1.6 million spike.
In the case of Kileleshwa, an acre of land rose from Ksh231.3 million to Ksh232 million and Muthaiga also indicated an increase of Ksh3.7 million (from Ksh185.7 million to Ksh189.4 million).
Parklands indicated an increase of Ksh9.9 million - with the price skyrocketing from Ksh375 million to Ksh384.9 million.
Nairobi Satellite towns such as Kiambu, Juja, Ongata Rongai, Kitengela also recorded a surge with land prices in the areas growing with a notable increase. An acre of land currently goes for an average of Ksh14.6 million.
Nyari was the best performing suburb with prices increasing by 7.18 per cent while Spring Valley recorded the highest price increase in the final quarter (2.2 per cent).
In the third quarter, Loresho had shown the largest drop with a -1.32 per cent while Riverside recorded a price drop of 5.1 per cent for the whole year.
According to Sakina Hassanali, Head of Development Consulting and Research at Hass Consult, the rate of price appreciation in the satellite towns increased at a faster rate than in suburbs.
“In 2020, at the height of the pandemic we saw satellite towns record drops in tandem with Nairobi suburbs due to disruption to the economy and the accompanying uncertainty but the gradual opening up has triggered investors back to the towns at a faster rate than the suburbs,” she stated.
Hassanali, however, pointed out that owing to the developments in various towns and estates, prices were affected with some recording a significant drop.
"There are many developments in the area, both complete and upcoming, and developers normally will want for stocks of units to be taken up before they can continue with their plans which has an effect on prices.
"Also, for now, it is still not clear if completion of the Western Bypass will open up adjacent areas, which has the potential to create new hotspots,” Hassanali pointed out.
Currently, Upper Hill still tops in land prices with an acre going for Ksh509 million.
