Saturday, April 25, 2009

Economic Meltdown: Not for Kenya Real Estate?

Am just back home from an impromptu scan of real property for sale and letting in the Lower Kabete area of Nairobi. This is a plush area neighboring the real lower kabete where I once lived. I had promised myself that if I worked hard enough, saved well enough and the stock market kept its promise, I would reward myself with a plot in this area and put up a dream house amongst the whos of Nairobi. Michael Joseph and his long serving CFO would be some of my neighbors whose wives would be coming occasionally for salt or a few chit chats with my own.

The landscape has started to change markedly with most houses that stood on 1 acre plots being pulled down to give way for community living made of town houses. I went to couple of these and what I saw left me dumbfounded. Generally the houses are quite beautiful and spacious. only thing is that the gardens are pretty small and even though the units are sitting on a half acre each, the area left for afternoon lazy reading in open air is pretty confined. Secondly most constructors have not respected the eco system at all and area basically turning the area into another concrete jungle though this time with more beautiful concrete than say Kileleshwa or umoja. secondly the construction is done even on top of streams or very close to stream. Price guide? introductory price of 50 million for most. 50 mi? yes fifty million Kenyan Money. The persons who are selling somehow refused to judge me from my cover and even started negotiating with me and telling me the area was prime and the houses would appreciate further.

But but. I mean err. I thought there was economic melt down globally and so property prices were depressed. In fact in US people are now able to buy houses they never dreamed of. No correction. Economic melt down only affected hao wazungu. In fact I was being told that those very plots were going for about 6 million shillings early last year but were now only available at 24 million. 24 mil? yes 24 million per acre and since they are mostly foreign owned (in fact even these ones had strange looking specimen) no one was selling. So its 24 million and unavailable.

On the other side of the city , Southlands the houses which were about 7 million last two years are heading towards 15 million. something doesn't seem right and my smart friend has suggested to me that the pirates money is finding its way into Kenyas prime estates and if we don't watch out, Kenya will soon be a Somali state and all our poor souls will be sent to the Kiberas of this world. Now he warns that Mungiki governance is a walk in the park compared to what the war lords of Somali would be able to subject us to!


  1. Hello, I like the blog.
    It is beautiful.
    Sorry not write more, but my English is bad writing.
    A hug from Portugal

  2. Hi,

    Great post.

    I visited the Homes Expo in April and I was shocked by the prices too. 15 million is a flat in kileleshwa/kilimani where you can see quite easily into your neighbours house.

    50 million is the going rate for lower kabete. Kitisuru and the like are at 40-45million. And as you mentioned these are houses with mini-gardens.

    If you have 40-50million you are better off buying a house on 3/4 an acre in an old area with zoning control and an aggressive neighbourhod watch group that ensures no 'change-of-user' applications for the area go unchallenged.

  3. Thank you Luis. Welcome to my blog

    @kenyanreality, its simply ridiculous! i still wonder why people spend upwards of 15 million to buy an apartment!


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