Land prices in Nairobi's satellite towns increased at the fastest pace in more than two years on-demand from developers amid recovery from Covid-19 economic hardships.
Data from real estate research firm HassConsult shows that prices of land in Kiambu, Syokimau, and Kiserian jumped by an average of 2.48 percent in the three months to September, up from a growth of 1.12 percent in June and a contraction of 0.06 percent in a similar quarter last year.
The economic recovery has revived the feverish rise in house and land prices that had some Kenyans worried a bubble may be forming, especially outside the capital.
Land prices in most Nairobi satellite towns dropped in the six months to September at the peak of the coronavirus economic hardships that cut demand for property.
Kenya’s economy surged an annual 10.1 percent in the second quarter to June thanks to a rebound across most sectors and helped by relaxed Covid-19 restrictions.
But land prices in the city, which are beyond the reach of Kenya’s working class, grew at a slower rate of 0.3 percent as developers sought cheaper options outside the capital.
“The Hass land price indices results for the third quarter of 2021 showing satellite towns continue to lead in price improvements over the quarter. The last time towns recorded similar price increases was in the third quarter of 2019 or two years ago,” said Sakina Hassanali, Head of Development Consulting & Research at HassConsult.
The real estate consultancy says the gradual reopening of the economy has seen land prices bounce back from lows witnessed during the pandemic.
Kiserian town was the best performer on a quarterly basis gaining 5.3 percent with an acre of land retailing at Sh8.7 million while Ngong Town was the laggard following a 0.1 percent dip to Sh25.3 million.
Kiambu town saw a 4.8 percent increase to Sh39.7 million for an acre while the same size in Ruiru appreciated 3.9 percent to Sh25.9 million on average.
An acre in Athi River rose 3.8 percent to Sh15.4 million and was up 2.7 percent in Syokimau to retail at Sh23.1 million.
In Juja land prices appreciated 3.2 percent to Sh15.8 million while an acre in Kitengela land was up 3.6 per cent to Sh13 million.
In Nairobi, Spring Valley was the best performing suburb with prices increasing by 2.2 percent to Sh181.8 million over the quarter.
Upper Hill remained the most costly location where an acre costs Sh509.7 million followed by Westlands at Sh423.4 million an acre on average.