Apartments in Hurlingham, Nairobi. Tenants of three-bedroom units have benefited from slower rent rise while investors have fetched the least returns. PHOTO | FILE
What you need to know:
Rent for three-bedroom maisonettes is up to Sh33,123 on average from Sh28,008 in 2012, representing an 18.2 per cent jump.
Property developers attributed the slower growth in the maisonettes market to oversupply and middle class' preference for smaller houses.
Three-bedroom houses have recorded the slowest growth in rent over the past five years, pointing to oversupply in the high-end housing segment.
Rent for three-bedroom maisonettes is up to Sh33,123 on average from Sh28,008 in 2012, representing an 18.2 per cent jump, according to the Kenya National Bureau of Statistics (KNBS).
This pace is slower than that of two-bedroom flats which are up 25.6 per cent over the same period to an average of Sh20,080 from Sh15,982.
This means tenants of three-bedroom units have benefited from slower rent rise while investors have fetched the least returns. The KNBS does not currently track the rent for one-bedroom houses.
Property developers attributed the slower growth in the maisonettes market to oversupply and the faster pace in two-bedroom rental prices to rising demand among working middle-income households.
Two-bedroom flats whose location is near or along routes connecting to commercial towns have proved convenient in daily commute.
Maisonettes are often located in places farther from town centres and are preferred by the rich while most middle-income commuters opt for two-bedroom units whose lower costs match their budgets, according to Anthony Mugo, chief executive of Falcon Development— a real estate developer.
He cited Nairobi’s Kilimani and Kileleshwa estates where several three-bedroom houses have been unoccupied for months as supply exceeds demand.
Rents in the cities — Nairobi, Mombasa and Kisumu — are generally higher due to higher demand and cost of living.
The KNBS shows that Nairobi’s middle class homes spend the bulk of their monthly income (23.6 per cent) on housing, utilities and cooking gas, exposing them most to the rising costs.
Poor homes spend 18.2 per cent of their income on rent and utilities while rich homes spend 19.8 per cent.
Landlords are now required to pay 10 per cent of gross rental income in taxes compared to the previous 30 per cent of their profits. Taxing gross rental income means landlords will not deduct costs incurred on wages, repairs, utilities and land rates.
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Note: The results are not exact but very close to the actual.
