The Covid-19 pandemic has reduced buyers’ appetite for apartments. According to a survey by property firm Knight Frank on its clients, 50% of respondents said they are less likely to want to live in an apartment in the future.
Home offices, greater privacy and outdoor space are now top priorities for well-off Kenyans looking to buy homes. Up to 77% of respondents said they are more likely to work from home following the pandemic.
Buyers also expect property prices, which have been falling, to fall in the next 12 months with 18% of the respondents indicating they are shoring up capital to buy a second home as a result of the pandemic.
Respondents said second homes would act as a retreat or haven in case of future outbreaks, lockdowns or disasters, and to enhance their lifestyle.
Knight Frank said the company has witnessed a surge of inquiries for prime properties at the Coast and up Country.
The survey, which was undertaken between 15 September and 14 October 2020, found that improved access to quality healthcare ranks highly as a reason to buy in the future.
“With people spending more time at home, the demands on our homes have increased. Many have had time to think about and experience at first hand whether their homes meet their current lifestyle needs and review what they would prioritise when buying a new one in the future. This is reflected in the survey results as there’s an increased demand for detached homes and a desire for outdoor space and home offices. Although some results were to be expected, their implications will undoubtedly have a significant effect on the residential market“, said Anthony Havelock, Head of Agency at Knight Frank Kenya.
Future Buying Intentions:
Close to a third of survey respondents indicated that they were more likely to move homes over the next 12 months as a result of the pandemic (32%). Of those respondents, most are looking to stay in the same location where they currently live, but move to a different property (72%).
54% of respondents say that they are more likely to buy a detached family home than they were before Covid-19.
In terms of their budget, 66% of respondents said that their budget had declined since the start of the pandemic. However, 32% of respondents believe that their spending power remained the same and 2% believed that it increased.
The survey highlights that buyers expect prices to fall over the next 12 months (50% of respondents), whilst 36% do not foresee any change and 14% believe that prices will increase.
Prime residential prices in Nairobi fell by 2.9% over the first half of 2020, due to an unfavourable economic climate, a continued oversupply of residential developments, low liquidity, and an exit of expatriates (niche market) returning to their home countries due to the pandemic.
“What should we expect as we enter 2021 is a question at the top of most of our buyers, investors and sellers’ minds. Over the course of the pandemic, we have seen reduced sales pricing and discounted rents, a trend we anticipate will continue into next year. As businesses continue to reopen, however, we expect to see a gradual recovery, so buyers may need to act quickly to capitalize on the present price levels. Looking at the residential market recovery, Kenya’s unique position as a regional business hub, together with current government interventions, will also go a long way in supporting this,” Knight Frank Managing Director Ben Woodhams said.