Kenya’s affluent households are expected to remain cautious in the residential property market this year, with wealth managers predicting only limited home purchases even as multiple-home ownership becomes increasingly common among high-net-worth individuals (HNWIs).
- •The latest Knight Frank Wealth and Investments Trends survey shows that 39 percent of wealth managers expect fewer than 10 percent of their clients to buy a home in 2026.
- •The outlook represents only a marginal improvement from 2025, when 43 percent of wealth managers said fewer than one in 10 of their affluent clients purchased a home.
- •The findings suggest that while wealthy Kenyans still value residential real estate as a long-term store of wealth, they are becoming more selective about new acquisitions amid expensive mortgage financing, high living costs and shifting investment priorities.
According to the survey, 44 percent of wealth managers said their clients typically own three homes, up from 39 percent a year earlier. Another 30 percent reported that clients own two homes, while 17 percent said they own a single home. Only four percent indicated that their clients typically own four homes.
For many wealthy households, property portfolios extend beyond a primary residence to include holiday homes in coastal or upcountry locations, family retreats and investment properties that generate rental income or offer long-term capital appreciation. The findings reinforce residential real estate’s enduring role in wealth preservation and lifestyle planning, even as fresh purchases slow.
Wealth managers attribute the subdued buying appetite to persistent structural challenges in Kenya’s housing market.
Mortgage financing remains largely inaccessible, with fewer than one percent of adult Kenyans holding a mortgage. High borrowing costs, steep deposit requirements and significant legal and transaction expenses continue to keep formal home financing out of reach for most buyers.
Many investors also continue to favour undeveloped land over completed homes, viewing it as a more flexible investment that allows construction to be undertaken gradually as financial capacity improves.
The Real Estate Market
Broader economic pressures have further dampened demand. Although inflation has eased, higher household spending on essentials has constrained disposable incomes, making buyers more cautious about committing to major residential investments.
Data from the Kenya National Bureau of Statistics (KNBS) shows Nairobi’s homeownership rate stood at about 7.7 percent in 2024, underscoring the affordability constraints that continue to shape the country’s housing market.
The cautious outlook comes even as Nairobi’s prime residential market continues to demonstrate resilience.
According to the HassConsult Property Price Index for the first quarter of 2026, residential property prices in Nairobi’s suburbs rose by 1.1 percent, accelerating from 0.8 percent in the previous quarter, largely driven by sustained demand for standalone houses. In contrast, prices in satellite towns fell by 0.9 percent after posting marginal growth of 0.1 percent in the final quarter of 2025.
The divergence between houses and apartments became more pronounced during the quarter. Detached homes continued to underpin price growth across prime suburbs, while apartments faced mounting supply pressures that weighed on values in several locations.
Lavington recorded the strongest quarterly house price growth at 4.2 percent, followed by Spring Valley (4.0 percent), Kilimani (3.9 percent), and Karen, Loresho and Westlands, which each posted growth of 3.8 percent.
The apartment market delivered a mixed performance. Muthangari and Riverside recorded gains of 3.8 percent and 1.8 percent respectively, while prices declined by 2.8 percent in Westlands and 2.5 percent in Upper Hill as increased supply pushed some markets towards saturation.
“House price growth in the suburbs is being driven by sustained demand for detached homes, supported by relative undersupply and strong performance across multiple locations such as Lavington and Spring Valley. In contrast, the apartment segment is seeing the effects of increased supply, with some areas moving toward saturation,” said Sakina Hassanali, Co-Chief Executive Officer and Creative Director at HassConsult.
In Nairobi’s satellite towns, prices weakened across both housing and apartment segments as affordability pressures continued to weigh on middle-income buyers.
“Rising living costs and constrained household incomes have reduced buyers’ ability to afford homes, resulting in price corrections across both housing and apartment segments,” Hassanali said.
While the sales market softened, the rental sector continued to strengthen. Rental prices in Nairobi’s suburbs rose by 1.3 percent during the quarter, while satellite towns posted growth of 1.4 percent, reflecting sustained demand from households opting to rent rather than buy.
Juja and Ngong recorded the strongest rental growth among satellite towns at 4.0 percent and 3.9 percent respectively, while only Kiserian and Ruiru registered declines in asking rents for houses.
The rental market’s resilience helped keep gross yields in Nairobi’s suburbs steady at 7.4 percent, while yields in satellite towns edged up to 5.3 percent from 5.2 percent in the previous quarter.
