Nairobi's Property Market Outpaces London in Price Growth

As of 2023, the number of high-net-worth individuals residing in Nairobi has increased by 30% in the last decade.
Nairobi rose from the 163^rd most startup-friendly city to 137^th within the last year.
Nairobi is the 4^th wealthiest city in Africa and 74^th wealthiest city worldwide. It has also been ranked 5^th city in Africa with the highest number of dollar millionaires.

Property values the world over have increased exponentially over the last decade. However, it is mind-boggling why cities in Africa are experiencing higher appreciation rates compared to cities in developed countries.

Demand for luxury apartments has led to the development of exquisite apartment complexes such as GTC. A 3-bedroom apartment ranges from Ksh 31 million up to Ksh 71 million. Another iconic development is 88 Nairobi, with apartments ranging in price from Ksh 20 million all the way to Ksh 115 million.

So, why are property prices in Nairobi growing faster than properties in Hong Kong and London? You may ask!

Nairobi's property market outpaces that of London and Hong Kong

Table of Contents

Factors Influencing Increase in Nairobi Property Value

There are several reasons why property in Nairobi is becoming more expensive by the day. They include;

Higher disposable incomes by new money millionaires

The increase in the number of dollar millionaires had led to increased demand for luxurious apartments and mansions. This has led to an increase in demand for properties in high-end areas.

Additionally, developers are now spending more money on house finishes to ensure that they capture potential buyers’ desires.

Infrastructure development

Due to infrastructural development, areas in Nairobi that were a nightmare due to traffic are now easily accessible. This has made living in those areas more convenient.

As a result, there has been an increased demand for houses in these locations, leading to an imbalance between demand and supply.

The newly developed Nairobi Expressway has made working and living in Nairobi much easier, thus increasing the value of properties close to its proximity.

One of the busy streets in Nairobi, a city in which the property prices are soaring — The beautiful Nairobi CBD street

Zoning laws

Rezoning of areas that did not allow development of apartments in the past has also led to increase in land prices. As developers are in a mad rush to buy land for redevelopment in those prime areas.

At the moment, middle-income home buyers are choosing to buy apartments in Hardy, Kilimani, and New Kitisuru that fetch an above-average market price due to the high cost of land in these areas.

Gentrification

Since 2020 the price of land around Two Rivers Mall has risen tremendously due to gentrification. This has led to the demand for housing in the area by young adults looking to live in areas with modern amenities within walking distance.

Additionally, an influx of expatriates looking to startup businesses in Kenya has led to a demand for more modern house designs, which are ultimately more expensive.