I have just seen this report whose link was kindly posted by SCUBIDU (Thanks Scubidu) on the Convexity of bonds thread. I have had a quick read and although I am no property expert, I can see some glaring inconsistencies with what I know to be the facts on the ground.

It is however a nice read, especially considering that is precious little data on the Real Estate market in Kenya.

You will all recall seeing the oft quoted statistic of the annual supply of housing in Kenya standing at 35,000 units against demand of 150,000. I think I have been seeing this same statistic for the last 5 years. With population and economic growth during the period, I think this is seriously OUTDATED.

I would therefore commend Hass Consult for their initiative, even if I think their study is skewed towards high end properties.

Have a read and see what you think.

Here's the link.

http://www.hassconsult.c...ries/quarter%203.10.pdf

SCUBIDU - I hope you do not mind my taking this liberty with what you initiated.

Over to y'all!

The report reads; “Hass Consult is today issuing for the first time a nationwide index of property prices in Kenya.”

It further states that; “The Annual average is representative of all properties offered for sale in Kenya.”

In the Index, “The average value of a property has gone from Kshs 6.83 million in December 2000 to Kshs 19.34 million in September 2010.”

As for rentals, it says, “The Hass Property Composite Index is representative of all property for rental in Kenya.”

It then summarizes, “The average rental of a property has gone from Kshs 36,766 in December 2001 to Kshs 93,959 in September 2010.”

In my view this is certainly not representative of a Kenya wide situation. It seems to be based on the sort of properties that Hass Consult and others such as Knight Frank and Dunhill deal with. Knowing what the average income is for most middle to upper income Kenyans, I would doubt that many pay an average monthly rent of 94 K a month. While they are those who do indeed pay rents of more than 200K, I believe that these are in the minority and hence the mean would be pushed well below what they give as an average.

Looking at specific average rentals for various suburbs I also doubt whether the average rent for an area such as Kitengela is Kshs 49,300, Thika 40,100 or that of Buru Buru is 17,300.

What do others think?

Looks like I am doing badly. My rent is less than $1,000 and the average is around $1,200. I need to find myself a new job.

I've gone through the report and I have to agree with mwanahisa and muganda. It is not representative of the countrywide figures as alluded.

But I think HassConsult are onto something big here. They will definately need to collaborate with other developers and agents to collate this info into something worth investing in. Considering the dearth of info on real estate, I believe there are many people, me included who would be willing to part with some Kshs to access this info!

I see the average rent for Kitengela is higher than for South C! Really?

No no no... this is why it's important to take the step of actually reading the report. This is fabulous, fantastic read! For the first time in my life, I can actually answer the question:

What's the average rate of return for properties in the last 10yrs? Fabulous.
And what will the effect of this report be? More information = better planning and better buying.
Hass Consult Quarter 3 Year 2010 Report.


BUYING SNAPSHOTS:
* Average Kes 19m
* 4-6 bed Kes 28m
* 1-3 bed Kes 10m

RENTAL SNAPSHOTS:
* Average Kes 93,959
* 4-6 bed Kes 137,000
* 1-3 bed Kes 54,000

The average price and rentals per suburb on page 8 is more comforting and realistic - though some questions remain?