Ngong, Spring Valley top growth as Nairobi land prices hit record high
Nairobi City skyline on Thursday. The prices of land have been on an upward trend with some areas asking for almost Sh200 million for an acre.
Land prices in Nairobi have hit a record high and closing in on Sh200 million an acre on renewed development activity with Ngong and Spring Valley topping the growth rate in pricing among the city’s suburbs and satellite towns.
Latest data by a realtor, HassConsult shows that while overall land prices in Nairobi increased slightly by 0.3 percent in the three months to March compared to the quarter ending December, the average cost of an acre of land in the city has hit Sh194million with some 10 suburbs recording a sharp increase the price tags that have hit pre-Covid-19 levels.
The realtor attributes the growth in land prices to sustained confidence in Nairobi's land market as development projects are undertaken, raising the price to the highest rate the market has experienced.
“A renewal of development activity has been the driving reason for land price recovery and 10 out of 18 Nairobi suburbs now have prices above their pre-pandemic rates,” said Ms Sakina Hassanali, Head of Development Consulting and Research at HassConsult.
The report shows that of Nairobi’s satellite towns, Ngong has shown the highest quarterly and annual increase in land value, increasing by 18.58 percent over the past year, while land in Rongai has reduced value by the highest margin over the past year, 7.98 percent.
Of the Nairobi suburbs, Spring Valley has witnessed the highest increase in land price over the past quarter and year- 18.84 percent, while Lavington (1.35 percent) and Kileleshwa (2.85 percent) saw their land prices come down by the highest margins over the last quarter and year respectively.
The average price of an acre of land in Ngong cost Sh30.6 million between January and March 2023- a 2.64-fold increase from 2013, Sh23.6 million in Ongata Rongai after losing 8 percent value compared to a year ago and Sh44.3 million in Kiambu, the most expensive of Nairobi satellite towns.
Within Nairobi suburbs, those showing a high rate of growing their value are Donholm, Kitisuru, Langata, Loresho, Muthaiga, Nyari, Ridgeways, Runda, Spring Valley, and Westlands, all of which have increased above their pre-pandemic rates.
But the most expensive suburbs in terms of average price for an acre of land remain Upper Hill (Sh486.5 million), Westlands (Sh450.2 million), Parklands (Sh405.8 million), and Kilimani (Sh397.7 million).
Suburbs that had huge increases in land prices between January and March were Spring Valley (Sh231.9 million), Loresho (Sh99.5 million), Donholm (Sh76.5 million), and Langata (Sh74.8 million).
Despite prices in the above suburbs exceeding their pre-pandemic levels, HassConsult noted that in Kitisuru, Nyari, and Gigiri, which attract foreign officials and expatriate staff, “have experienced a slight dip in land prices.”
“These suburbs corrected this quarter after several quarters of heated pricing on the expansion of Kenya's diplomatic zone,” said Ms Hassanali.
Land prices in Nairobi's satellite towns increased by 1.28 percent over the quarter continuing their trend of higher appreciation rates compared to similar parcels in the city.
The realtor notes that the value of land in Nairobi’s satellite towns continues to grow faster than within the city, due to the towns' affordability and improved infrastructure that has attracted potential investors.
“Year-on-year growth shows land prices in the satellite towns increased by 8.08 percent compared to a 1.42 percent annual increase in land prices in the city,” it stated.
