This archive report was first published on 10 August 2019.
Published on August 10, 2019, the Kenya Bankers Association (KBA) Housing Market Index for the second quarter of 2019 revealed a worrying trend in the property market.
The index showed a 1.72% decline in the change of house prices during the second quarter compared to a 2.78% decline in the previous quarter, according to Jared Osoro, KBA head of research.
The poor performance in the second consecutive quarter points to a worrying trend that will affect both the demand and supply sides of the property market.
On the supply side, the number of building approvals has declined marginally from 2,252 between January to June 2018 down to 2,238 between July and November 2018.
Developers are opting to build more apartments in order to capitalise on the high cost of land particularly in Nairobi and the satellite towns.
At the same time, middle-income earners now form the bulk of buyers in the economy, with an upsurge in apartment prices compared to that of maisonettes and bungalows.
According to the index, apartments accounted for 81% of the total units in the second quarter compared to 62% in the first quarter of 2019.
Maisonettes and bungalows, on the other hand, recorded a 10% and 8% decline respectively over the same period.
