There will be no significant drop in the price of residential houses as some analysts had earlier predicted, a real estate agent has said. According to Hassconsult, the figures (Hass Property Index) drawn from their sales and backed by data from other agents indicated that prices for residential houses had stabilised in Nairobi.
Analysts had predicted last year that property prices would crush due to the global financial crisis.
Quarter offers hope
Speaking at the Hilton during the release of a report, “Property Development”, Mr Farhana Hassanali, a manager, said that Nairobi’s asking price for property was flat in the first quarter of 2009, but rose in the second and third quarters before falling in the fourth quarter by 3.2 per cent.
“Fourth quarter offers hope that the market may not be in the kind of drastic slide in prices that some analysts have predicted.”
However, they said it was still difficult to say with certainty for how long the prices will hold at current levels.
“No one can predict absolutely how houses will sell and move in the months and the years ahead.”
They said after initial downward correction in sales prices, this had been followed by drop in asking prices, while the sales prices stabilised in the fourth quarter. This, they said, increased the number of those who wanted to buy houses.
The data does not include properties with development potential or land plots, but town houses, apartments and villas.
The index mainly relied on high-end prices, and although there was adjustment to reflect sales mix, the consultants said it could represent some variance to what some agents, buyers and sellers were experiencing.
The asking price
The agent introduced composite index drawn from established estate agencies in Nairobi, and based on the asking price to establish the trend, and draw conclusions.
The asking price is not inaccessibly the price the property was sold for, but is a general indicator of the market situation.
“Both indices show that the dip up and dip down house prices were almost flat across the year 2009 for both asking price and the sales price,” they said.
The asking price for local residential property doubled between the middle of 2006 and the end of 2008.