Work permit rules leaves high-end houses empty as expats exit

In Summary

• Most affected are estates such as Spring Valley, Runda, Nyari, Muthaiga and Karen

• Nairobi has been positioned as one of main pillars for economic growth in Africa

Hass Consult's Sakina Hassanali
Hass Consult's Sakina Hassanali
Image: FILE

The flight of international residents from Kenya is being felt in the top-end estates.

Real estate agents HassConsult said that changes made to Kenya's work permit regime in 2018 led to an exodus of foreigners, leading to empty spaces.

Most affected are estates such as Spring Valley, Runda, Nyari, Muthaiga and Karen.

“As a result, the prices of top-end detached houses for sale fell by 4.4 per cent in the first quarter of 2019, while rents fell by 1 per cent, as owners and sellers cut prices in an effort to sell or refill,” HassConsult head of development, consulting and research Sakina Hassanali said.

The situation, it said was further worsened by foreign governments adjusting to international pressures, reducing foreign spending and tightening budgets.

This led to retrenchment of residents in international and aid-funded operations affecting a substantial proportion of these homes.

To mitigate the impact, Sakina said developers have adopted a new trend of  converting large detached houses into multiple residences. However, there is need for correction in the rental pricing.

 “The Kenyan property market has matured, and the only apartments that will now sell and fill quickly are those where developers have properly researched the market and constructed accommodation that fills a proven and unmet need,” she said.

 She said there will be continued downward pressure in this segment until the international economy improves or Kenya initiates policies to attract renewed growth in international residency.

Nairobi has been positioned as one of main pillars for economic growth in Africa, as centre of diplomatic and commercial activities.


This has led to global organisations picking the country as the headquarters in the East African region or the African continent.

This has attracted foreigners who come into the country as tourists before using proxies to get work permits.

This pushed the government through the Immigration department to stop issuance of work permits in the country in August 2018.

The directive required them to apply for the document from their home countries before travelling to Kenya to take up  jobs.

Foreigners in the country had to undergo fresh registration targeted at flushing out out those in the country illegally.

Sakina said the mid-market growth remained solid with sales and rentals slowing marginally, but robust.

In the three months of 2019, rental prices of smaller multi-storey units built by private landlords including Ruiru, Ruaka, Juja and other Nairobi satellite districts rose by 1.7 per cent, taking year-on-year growth to 11.1 per cent, while sales prices rose by 1.3 per cent, taking year-on-year growth to 7.9 per cent.