Property prices in Westlands suburb showed the strongest performance over the year according to the latest house price index from HassConsult with prices in the suburb improving by 7.9 per cent.
Over the past few years, Westlands has grown to become a melting pot for international hotel brands setting up in the area as they seek to tap into Nairobi’s growing market for Meetings, Incentives, Conferences, and Exhibitions (MICE) tourism. As a result, properties in the area have greatly benefited in terms of capital appreciation.
The growth of MICE tourism has had a ripple effect on apartments, detached and semi-detached housing market in the Westlands suburb as some visitors opt to stay in serviced apartments or houses located in close vicinity to the hotels where major conferences are taking place.
“The flourishing niche market for MICE tourism has opened an opportunity for entrepreneurs who are turning houses and apartments for renting to attendees of major conferences, some of whom prefer serviced apartments and houses over hotels and this is resulting in an uptick in prices,” said Hass Consult’s Sakina Hassanali.
Hassanali added that the Westlands area is additionally undergoing the “rediscovery” phase of the urban regeneration cycle which is the result of high income earners moving back to neighborhoods that had previously seen an exodus of these tier of residents.
“Classically, in urban markets, areas that are initially populated by high-income earners are often, over time, developed in ways that lead to a shift in the mix of the population, with middle-income earners beginning to move into the area,” she said.
“This can cause flight by the elite, to the next upmarket beauty spot. As the high-end residents vacate, property becomes further developed, often at higher density, and the area will see an influx of lower-income earners. This takes the cycle on a further stage, as middle-income earners also seek to relocate. Finally a younger generation of middle-income earners comes to develop this area making it get ‘rediscovered’,” added Hassanali.
Overall the detached housing market posted the strongest performance at 1.3 per cent over the quarter while semi-detached houses posted an 11.8 per cent over the year.
On the rental front asking rents continued to marginally rise over the quarter at 1.5 per cent and 4.7 per cent on an annual basis.Apartments led the pack on over the quarter at 3.5 per cent while semi-detached houses topped on an annual basis at 11.5 per cent.