Investors Warm Up to Rongai Real Estate

Nairobi’s satellite town, Ongata Rongai has emerged as an investment hub for real estate investors seeking high returns. A forecast for residential real estate investments done by analytics firm DataFintech in the month of September shows that the one-year yield for a 3-bedroom house in the location is expected to be at 22.4%.

In details, the projected capital gain for 2017 is 22.4% with rental yield at 4.5% giving a total yield of 26.9% according to the forecast. Hawk-eyed investors have over the past months been active in Rongai, which has given the location a positive outlook. And now land price appreciation in 2017 is projected to be 13.3%.

The price per acre of land in the area rose from Ksh. 16.33m in Q1 of 2017 to Ksh. 17.63m in Q3 of 2017. This is further expected to rise to Ksh. 18.5m in Q4 of 2017.

The median sale price forecast for Q3 2017 and Q4 2017 with a 90% confidence interval is Ksh. 7.44m and Ksh. 8.26m respectively. This is an appreciation of about Ksh. 1.26m within that period.

The bid price is estimated to be 10% lower than the ask price for sale listings.

Sales prices took a slight appreciation beginning Q1 of 2016 before slightly dipping by about Ksh. 0.4m between Q3 and Q4 of 2016.

Between Q4 2016 and Q1 2017, sales prices remained constant before initiating a slight upward movements in Q2 of 2017. Currently at approximately Ksh. 7.5m, the price is expected to rise further to Ksh. 8.26m by the end of 2017

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