Kenya’s residential market is experiencing remarkable growth across the income spectrum, driven by increasing demand from local buyers, expatriates, and international investors.
This segment has become a focal point for developers and stakeholders seeking to capitalize on Kenya’s evolving real estate landscape.
Currently, Kenya’s housing market is divided into two segments: the luxury and affordable market.
On the luxury end of the residential market, Kenya’s growing number of high-net-worth individuals and expatriates are driving demand for premium properties in exclusive neighbourhoods.
This demand for premium properties is driven by affluent buyers, with projections indicating further growth to 16,900-dollar millionaires by 2026, according to the 2024 Africa Wealth Report published by Henley & Partners in collaboration with New World Wealth.
Nairobi ranks among the top cities globally for luxury real estate price growth, and in some cases, it has outperformed cities like London and Paris.
While the luxury end of the residential markets remains shaped by location, size of the unit, and breadth of features that align with buyer tastes and aspirations, Stanbic Bank believes that the luxury segment is not starved of attention from investors. However, the affordable housing market remains neglected.
“In that [affordable housing] segment, factors shaping the evolution of successful projects are the proximity of projects to key business hubs, accessibility to transport networks, and quality of offering trade-offs relative to price point.
“It is useful to highlight that the demand in a large section of this market segment is driven by the rental markets and the retail and institutional property investment markets,” says spokesperson Niyi Adeleye, the head of real estate finance for Africa regions at Standard Bank Group, which is part of the Stanbic Bank.
Real estate developers in Kenya struggle with access to long-term financing due to high interest rates and stringent lending requirements, leaving them with limited financing options for residential projects.
There are also land tenure issues, with legal disputes over land ownership that can delay projects and increase costs for developers.
Another conundrum is that the demand for residences and luxury homes often outpaces supply, which creates competitive pricing pressures.
“There’s a strong and growing demand for developments that offer world-class lifestyle amenities—spaces that speak to health, wellness, and fitness, all delivered through a refined user experience. Residents are looking for environments that support balance, well-being, and convenience, echoing global trends in urban living,” says Hass Consult, CEO, Farhana Hassanali-Hashmani.
The dynamics of Kenya’s high-end residential market will be explored during the upcoming East Africa Property Investment (EAPI) Summit, a premier real estate event that brings together over 450 global investors, developers, and professionals from the real estate industry. The 12th annual summit will be held in Nairobi from 7 to 8 May 2025, at Pullman, Upper Hill.
This year’s EAPI Summit will explore how developers and investors can capitalize on investment opportunities in countries such as Tanzania and Zanzibar, Kenya, Uganda, Rwanda, and Ethiopia, which are showing promising signs of economic recovery, improving political stability, and stabilizing interest rates.
Stanbic Bank is supporting this year’s EAPI Summit as a gold sponsor.
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