As more tenants free up rental properties, there has not been a surge in rent costs with average new rents falling marginally by 0.2 per cent between the first and the second quarter.
According to Kenyan property developers, Hass Consult, new home-ownership is still the best growth area in the housing market as opposed to renting.
While releasing second quarter results of the Hass Consult property price indices 2010, Jenny Leusby said that more and more Kenyans are saying goodbye to the landlords preferring to buy their own homes.
“The new range of mortgage offerings and finance partnerships have been instrumental in supporting the market through the downturn and in turn stimulating new and extended buying by professional Kenyans who were previously renting,” she said.
As more tenants free up rental properties, there has not been a surge in rent costs with average new rents falling marginally by 0.2 per cent between the first and the second quarter. The move, Leusby says, is encouraged by housing finance and mortgages products which assist in the purchase of new homes. “We continue to urge caution for investors looking to buy properties to rent out given the returns they will get at the current rent levels,” she says adding that there would be little or no upward pressure on rents since the market is well served and supply continues to expand faster than demand.
During the second quarter, the gap between asking and selling prices narrowed from the Hass Property Index, with asking prices falling 0.4 per cent after an upsurge of 7.4 per cent in the first quarter, as selling prices rose 0.5 per cent following a 1.8 per cent gain in the first quarter.
“Based on the changes over the last 18 months, we believe the housing market has moved into a more stable state, based on better information, and a closer relationship between pricing and true demand levels,” Leusby said adding that the market was not responding to ambitious sales pricing but instead creeping upwards steadily.
