NAIROBI : House prices increased by 1.26 per cent between July and September compared to a 0.2 per cent increase in the second quarter, according to the latest Kenya Bankers Association Housing Price Index. This, the association said, signals that demand is responding to the prevailing high interest rate regime.
The index shows buyers opted for homes in Kiambu, South B, Kabete, Komarock, Imara Daima, Membley, Buruburu, Rongai, Waiyaki Way, Mbagathi Road, Ngong Road, Langata, which were seen as more affordable at between Sh10 to Sh19 million.
It shows homes sold beyond Sh25 million in Kileleshwa, Kilimani, Lavington, Westlands, Spring Valley, Riverside, Milimani in Kisumu, Milimani in Nakuru, Runda, Karen, Garden Estate, Parklands, Ridgeways, Muthaiga, Loresho, Kitsuru, Adama Arcade, Nyali, and Mountainview.
According to the index, home prices have slowed down in Athi River, Mlolongo, Mavoko, Nakuru, Ngong, Ruaka, Syokimau, Embakasi,Kahawa Wendani, Thika, Mtwapa, Utange, South C, Kitengela, Kiembeni, Nyeri, Likoni, Eldoret, Ruiru, Kilifi and Thika road. It shows there was more demand for apartments compared to bungalows and maisonettes, while the preference of houses still continues to be influenced by their size, location and the available social amenities.
The KBA-HPI was launched in February and is based on clustered price ranges across several counties. KBA’s director of research and policy, Jared Osoro said there was a shift of expectations towards a high interest rates regime in the third quarter that is shaping the decision making of households seeking to take mortgages towards home acquisition.
“As the economy entered the third quarter of 2015, there was an inevitable tightening of monetary policy on the back of volatility in the foreign exchange market. As would be expected, the house prices responded to foreign exchange volatility and rising interest rates,” he said yesterday at the launch of the index in Nairobi.
He said unit sizes was the main price driver, with many people asking about the plinth area, number of bedrooms, whether the house has a balcony, master ensuite and domestic staff quarters.