• Houses in the high-market segment averaged Sh21.25 million, compared to Sh 17.58 million for the mid-market segment and Sh 10.97 million for the low-market segment.
• In terms of plinth area, bungalows still maintain the largest area (3,928.82 square feet), followed by apartments (2,624.88square feet) and maisonettes (1,291.20 square feet).
Homebuyers sought cheaper houses in 2023 even as real estate developers dealt with consistently falling prices throughout the year, according to a new report.
The latest Kenya Bankers Association (KBA) Housing Price Index shows that the low market segment recorded high demand in the last quarter, accounting for 62.3 per cent.
The shift to the low end was a steep rise compared to 48 per cent recorded in the previous quarter.
The trend followed an overall sustained negative pace of house prices growth in the first three quarters of the year despite recording a modest 1.53 per cent decline in the last quarter.
This was majorly driven by a slight strengthening of demand towards the end of the year.
"A fluctuating trend was evident in the construction sector; starting with a slight increase in the first quarter (3.06 per cent), followed by a decrease in the second quarter (2.55 per cent) and a subsequent rise in the third quarter of 2023 (3.8 per cent),’’ reads the Index, whose base evaluation rate was set in the year 2013.
The Index, which tracks housing price movements from the last quarter of the year 2021, shows a persistent and uneven negative-territory home prices growth trajectory, in a trend that the KBA-HPI associates with corresponding fluctuating activity in the construction sector.
Further analysis of completed transactions shows a significant drop, particularly in the mid-market segments to account for 21 percent from 37 percent in quarter three of the year.
In addition, there was a slight activity increase in the high-market section, to account for 17 per cent in quarter four from 15.2 per cent in the third quarter.
During the period under review, preference for apartments remained dominant despite recording a 14 per cent quarter-on-quarter decline between the last two quarters of the year.
The demand for Bungalows remained steady, accounting for 30 percent of the market share, with preference for maisonettes growing notably to 29.91 percent from 15.2 per cent in the third quarter.
For instance, the average price of a maisonette stood notably higher at Sh20.17 million, followed by apartments at Sh17.51 million and bungalows at Sh10.78 million.
The disparities in costs are also apparent across various market segments.
Properties in the high-market segment command significantly higher prices, with the average cost being approximately double that of the low-market segment.
Specifically, houses in the high-market segment averaged Sh21.25 million, compared to Sh17.58 million for the mid-market segment and Sh10.97 million for the low-market segment.
These variations underscore the segmented nature of the housing market, influenced by both region and house type.
"Similarly, in mid-market segment, we observe different patterns. Apartments have an average property value of Sh13 million, bungalows at Sh14.15 million and maisonettes at Sh18.17million," says KBA.
In terms of plinth area, bungalows still maintain the largest area (3,928.82 square feet), followed by apartments (2,624.88square feet) and maisonettes (1,291.20 square feet).
High-market segment exhibits yet another set of variations. Here, we notice the highest property values with maisonettes at Sh26.90 million, apartments at Sh18.67 million and bungalows at Sh14.14 million.
However, in terms of plinth area, bungalows take the lead again with approximately 4,187.76 square feet, followed by maisonettes (3,803.24 square feet) and apartments (2,344.22 square feet).