The Kenyan economy has faced many challenges over the last couple of years. Inflation has been as high as 8% recently, while the Kenyan shilling has depreciated against the US dollar. At current exchange rate, 1 USD equals 103.41 Kenyan shillings. Yet the property market in Kenya has done reasonably well.
The house price index in Kenya gained by just 4.21 percent in 2015, and has only marginally increased in 2016. The real estate sector as a whole grew by 5.4 percent in 2015 and contributes 8 percent to the nation’s GDP. This means the property market in Kenya is in a sweet spot. If you are looking to buy cheap property in Kenya fast, then this is perhaps an ideal time to do so.
The surge in Kenya’s property market was largely driven by government investment in the infrastructure. It’s not just Nairobi that has grown recently, even satellite towns such as Ruaka, Mlolongo and Athi River, have seen a lot of new developments.
Kenya is helped by rising prosperity, higher disposable incomes and a fast growing middle class. There has been a plenty of development across all segments of the real estate sector in Kenta – both residential and commercial.
The property market in Kenya is largely dominated by locals. Foreign investors still do not have quite the impact on Kenya as they do on South Africa, for example. The high domestic interest is a good thing as it keeps the asking prices in the market reasonable.
The Kenyan economy has certainly done well since 2000. Kenya has a fast growing GDP, much like many African nations. Since the country has a low base to start with, its high economic growth of 5 percent does look like being easily sustainable.
This is reflected in the rapid growth of the real estate market in and around Nairobi. Nairobi dominates the Kenyan housing market, just as London dominates the UK housing market. Properties for sale in Nairobi, Kenya are priced much higher than the average in the rest of the country.
Kenya is one of the few African nations that enjoy relative political stability. This has certainly created a safe environment for the growth of the property market in the country. There’s also a significant flow of capital into Kenya from large countries such as China, which have invested heavily in oil exploration in Kenya.
In fact, it is oil that is expected to take the country to further economic growth. The Kenyan shilling, despite its current weakness is one of the most stable currencies in Africa.
The biggest development in Kenya has been the rise of the growing middle class. The middle class wants affordable, comfortable and secure accommodations, which is not easy to get in Kenya.
In Nairobi, most of the apartments in affluent neighbourhoods cost Sh10 million or even Sh5 million, which is much beyond what most people in Kenya can afford. As a result, there’s a serious housing crisis in Kenya.
While there is certainly a lot of demand for properties, most of the ongoing projects are far too expensive for the people who would be interested in them. Still, if you are a foreign investor, there are a plenty of wonderful opportunities in the Kenyan residential property market.