The completion of infrastructural projects will raise demand for residential properties in Ruiru, Ruaka and Kikuyu towns in 2020, a new report suggests.
Cytonn Investment 2020 Market Outlook says the upgrade of Ngong Road, expansion of Northern bypass, completion of Western bypass and the upgrade of water and sanitation systems will drive up property uptake.
It says the three suburbs will also likely attract more investors in line with the government’s affordable housing programme.
“With the growing focus towards plugging the housing deficit, we expect to see more government incentives geared towards creating an enabling environment for home-buyers and developers,” says the report released Monday.
However, it adds developers will remain cautious in identifying market niches to prevent losses.
It indicates lower mid-end markets such as Riruta, Ruaka, Athi River, Runda Mumwe and Ridgeways will also attract more buyers and developers owing to relative affordability and good infrastructure.
Meanwhile, it projects purchasing power will remain subdued this year due to massive job losses and sluggish wage growth. “However, we are optimistic that the removal of the interest rate cap will improve access to credit,” it adds.
Cytonn expects the 4.3 percent urbanisation growth projection by the World Bank in 2020 to increase the demand for dwelling units with 70.7 percent of the demand being in the lower mid-end and low-end segments.
In the commercial office segment, the report projects the sector to decline due the current office oversupply at 5.6 million square feet.