The value of land in Nairobi last year rose at the fastest rate in seven years on post-pandemic recovery and market correction.
Data released by Real Estate firm HassConsult suggests that an acre of land in Nairobi suburbs grew by 3.96 percent last year on average, making it the fastest growth since 2016 when they grew by 5.14 percent.
The rise, partly attributed to a recovery from the dip occasioned by the pandemic, however, continued to trail inflation for at least a decade.
“The average price per acre in the suburbs has now crossed the Sh200 million mark, helped by the fast rise of prices in areas such as Langata, Ridgeways, Loresho, and Muthangari which offer a mix of affordability, ease of access and mixed-use zoning,” said Sakina Hassanali, head of development consulting and research at HassConsult.
Despite beating returns on equities, prices continued to trail government papers, offshore investments, fixed deposits and land in Nairobi satellite towns that appreciated by an average of 9.27 percent.
Land prices in the city contracted by a record 2.56 percent in 2020 pushing landholders to deeper losses but have since been rising for three consecutive years.
The rally in land prices is a sign of a recovering property market that has been subdued by reduced demand as a result of low incomes and an oversupply of rental spaces.
The release noted that 14 out of the 18 sampled suburbs recorded positive price movements in the fourth quarter of last year as Loresho and Langata were the biggest gainers in the year recording gains of 11 and 10.9 percent over the year respectively.
On the flip side Upper Hill, which was once the most coveted suburb in the city, has now seen its value contract for five consecutive years with an acre now averaging Sh478.2 million.
The continuous fall in land in Upper now means Westlands, the new darling for corporates has closed the gap with an acre going for Sh456.7 million.
By TIMOTHY ODINGA