Global real estate consultant Knight Frank is predicting an increase in property investment in Kenya during 2018 as the economy begins to gain momentum.
In its recently released report, Inside View Kenya, Knight Frank revealed that transactional activity in sales is expected to pick up, with both Nairobi and Mombasa attracting interest from local and international buyers.
Ben Woodhams, managing director at Knight Frank Kenya, said: “Kenya has a long-standing reputation as a destination for holiday home ownership, and with the political turbulence behind us, we are forecasting an increase in such investments in line with a strong economic recovery in 2018.
He added: “Among factors making Kenya an ideal investment destination include a projected 5.8% GDP growth rate in 2018, rapid urbanisation at 4.3% per annum versus a global average of 2.0%, an expanding middle class, and positive demographics such as high population growth at 2.6% annually against Sub-Saharan Africa’s average of 2.3%.”
Prime property
Following a period of unprecedented growth between 2010 and 2012 when annual price increases exceeded 30% a year, Nairobi’s prime residential market has witnessed a price correction in recent years, according to the report. However, Knight Frank believes the prime market is set to recover during the first half of 2018 as the current wave of political uncertainty draws to a close, ending a period of moderate price growth throughout 2016 and 2017.
In addition, currency movements over the two years to November 2017 have made it cheaper for foreign buyers, as those buying prime residential properties priced at Sh100 million (just over £700,000) would have saved up to 8.2% through euro-denominated transactions, while dollar-denominated purchases were 1.4% cheaper.
Most of the interest in the Kenyan property market comes from British buyers looking for holiday homes as well as lucrative investments in the growing market.
