Apartments are more expensive than bungalows despite the latter being bigger in size, according to a new report that reviewed house prices in the year ended December.
The housing price index report by the Kenyan Bankers Association reveals the average price of a maisonette stood at Sh12.15 million while that of apartments and bungalows stood at Sh9.38 million and Sh6.69 million, respectively.
The average plinth area of an apartment — the covered built-up area covered by the house with inside and outside walls — was 1,283.9 square feet compared to 1,631.4 square feet of bungalows. Bungalows were 1.2 times bigger than the apartment which would suggest it be more costly.
“The price dynamics would be determined not only by the house type but also the location where the house is,” said Samuel Tiriongo, research and policy director at the KBA.
“For instance, it is possible to have a bungalow in one region 1 (where say low-income households stay) being much cheaper than an apartment in region 3 (the high-end).”
The report analyses the three most important drivers of house price changes, including house type — with townhouses being the highest-priced, number of bathrooms and location of the house.
“The structural characteristics — including plinth area, the number of bedrooms, bathrooms, and floors — are established to drive average house prices significantly. In particular, it is observed that an additional 10 percent increase in the plinth area is associated with a 2.9 percent increase in the average house prices, all other factors remaining largely unchanged,” said the report.
More people across the country bought apartments than other house types at the end of December 2021.
“Apartments dominate, and their share rose, accounting for 56.8 percent of all the completed transactions in the fourth quarter from 47.0 percent in the third quarter of 2021,” the report read in part.
“The divergence in the proportions of house types by region and across types continued to characterise the dynamics in the market and the interaction between consumer preferences and the affordability of the houses.”