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Tycoons scramble for seized luxury homes in auctions
Poor weather, costly bank loans and disruptions that followed anti-government protests against the Finance Bill last year have created a growing pool of distressed borrowers whose assets are being seized by newly aggressive lenders.
increased demand for repossessed properties in high-end estates in Nairobi such as Runda, Karen, Kitisuru, Nyari, and Muthaiga.
This stands in stark contrast to the glut that has hit middle-income estates such as Kitengela, Athi River, Kiserian, Katani, Kamulu, and Ongata Rongai, where auctioneers are reporting increased repossessions and a lack of buyers.
The auctions divide between the middle and high-end estates underlines Kenya’s growing income inequality, with affluent buyers capitalising on seized properties to purchase premium assets and middle-income earners struggling.
Poor weather, costly bank loans and disruptions that followed anti-government protests against the Finance Bill last year have created a growing pool of distressed borrowers whose assets are being seized by newly aggressive lenders.
“There has been an upsurge in bids and purchases of houses and land in upmarket estates such as Runda, Karen, Kitisuru, Nyari, Muthaiga since the people going for such properties are financially stable and “not prone to the vagaries of the economy,” says Joseph Gikonyo, the proprietor and manager at Garam.
For instance, Mr Gikonyo said the prices of one-acre piece of land with a lavish house built on it has been fetching between Sh100 million and Sh200 million, depending on the neighbourhood.
Data from real estate consultancy firm HassConsult shows the price of an acre stood at Sh234.6 million in Muthaiga, Sh270.9 million in Lavington, Sh117.9 million in Nyari, Sh327.3 million in Kileleshwa and Sh72.3 million in Karen.
Mr Gikonyo reckons that most of the wealthy people are attracted to the already built houses sitting on at least half an acre.
“Despite these [high] prices, these properties are getting buyers because these are for monied people and they have no problem buying at such prices. All the properties we have attempted to sell in high-end neighbourhoods, we have seen a lot of interest and most, if not all, have found buyers,” said Mr Gikonyo.
The story is different in middle- and low-income estates: there is a glut of repossessed land, homes and office equipment being sold off cheaply.
Garam Auctioneers has offered to the market 97 properties worth over Sh2.65 billion, with most of them in middle- and lower-income areas. The majority (75) are residential houses and plots of land in satellite towns such as Kajiado, Kathiani, Mavoko, Kitengela, Kiserian, Joska, Ongata Rongai and Konza area.
Mr Gikonyo said that land and houses in middle-class estates are becoming more difficult to sell as workers and investors also put their properties on the market for sale.
“In the opening market, a lot of people have put up their residential properties for sale due to the hard times. These auction properties are competing with properties repossessed by banks,” he said.
Bank credit, easily available previously, has dried up after commercial lending rates surged last year, leaving lenders unable to refinance seized assets.
Non-performing loans in the banking industry rose to 17.4 percent in March, from 11.8 percent five years ago, the central bank said, jumping to levels last seen over 20 years ago.
But the economy retains stable macroeconomic fundamentals like inflation and a stable foreign exchange rate, leading auctioneers to believe seizures will ease next year.
Kenya's economy grew 4.9 percent year-on-year in the first quarter of 2025, a similar pace to the same period a year ago, driven by growth in sectors such as agriculture and manufacturing.
The economy faces risks from global trade disputes, market volatility and extreme weather conditions, according to the Treasury.
The Treasury projects the economy will expand by 5.3 percent in both 2025 and 2026, helped by a stable macroeconomic environment.
“When the economy starts performing poorly, people tend to put things like buying properties on the back burner; it is no longer a priority. The priority is to survive. This hits the auction market,” said Mr Gikonyo.
The craze of weekend visits to view plots, especially in satellite towns, has also noticeably declined, reflecting the economic strain facing the middle class.
Several buyers were making bets on purchasing plots to sell after price appreciation.
“We have hundreds of unsold small chunks of land scattered across Kitengela, Kamulu, Kiserian and other towns near Nairobi, yet in the past it never used to be too difficult to auction them off,” said Mr Gikonyo.
HassConsult’s report said tough economic conditions have hit demand for land in estates like Kiserian, Kitengela, Ngong, Ongata Rongai, Juja, and Thika.
The property agency report for the second quarter of 2025 matches shifts in the auction market.
The report shows that detached houses have outpaced semi-detached units and apartments in price appreciation because of a lack of supply of standalone units.
According to the report, the detached housing segment, which is made up of townhouses and villas, posted a five percent growth—the fastest pace in nine years— outpacing semi-detached units and apartments, which grew at 1.3 percent and 1.1 percent respectively in the quarter.
Muthaiga led the posh estates in house price increase at a 3.5 percent. Home prices rose in Karen at 2.5 percent, Runda (2.2 percent) and Nyari (2.1 percent).
“Detached house prices grew at their fastest quarterly pace in nine years, which also reflected in suburbs such as Muthaiga, Karen and Runda—that are largely exclusive of apartments— reporting faster property price growth,” said Sakina Hassanali, co-CEO and creative director at HassConsult.
