It is paramount that things shift a little bit in the rental horizon. There are many factors affecting renters in Nairobi that necessitates a bit of change. Some things will however, remain virtually the same. Change is almost inevitable and often unpredictable. However, by looking at a few factors that could influence the future one can almost predict what will be different.
- The first thing affecting real estate in Nairobi is congestion. As at 2019, the population of Nairobi stands at 4.5 million. This is an increase from 2018 and it is expected that the number will only go further up. That means that there are too many people to house in this city and not enough space to do it. This could be the reason for the recent careless development of real estate that ends up in piles of rubble. Developers are rushing to provide supply for the constantly rising demand.
- Another thing is the cost of living. People are able to buy less and less with the current income. This is causing them to seek out second jobs and side hustles or find cheaper housing. Not only will this situation of the ever-rising cost of living affect the Nairobi resident’s ability to pay their rent it will also cause some shifts in terms of the level of rent. Some landlords may lower as a means of supporting their tenants. Others may increase as they too are suffering through the crunch. This same difference in action will also apply to the rising level of unemployment.
- Over the last half of this decade, many businesses have opted to seek accommodation for their operations outside of the CBD. For this reason, areas like Ngong Road and Westlands have seen an uptake in commercial real estate. Many entrants into the Kenyan market are going this route too. Commercial spaces away from the CBD are not only easier to come by, but they also offer more value and in most cases, a better business environment. This delocalization has and will continue to impact residential rental decisions.
- There is also a new crop of renters in this town. People who have recently joined the workforce and those who have opted to rent as opposed to living in hostels. This new generation expects more. It expects a more valuable rental package than in recent years. The new generation of Nairobi renters has been and will continue to revolutionize how landlords advertise and operate in general.
What can you expect?
There will be more situations where people seek out roommates or rent out their extra rooms. This has already been seen with the increasing number of Airbnb landlords. Everyone is looking to make an extra shilling. With the congestion issue, finding decent living is becoming harder with many previously appropriately populated places becoming overcrowded and slipping into the slum status. There is already quite a bit of roommate and other shared living arrangements. This should be expected to continue and even perhaps increase as Nairobi becomes more populated.
Many countries and cities experience rural to urban migration. However, Nairobi in the last few years has seen a wave of urban to outskirts migration. Many people are opting to live in the outskirts like Syokimau and Kiambu rather than rent in the heart of Nairobi. This has been further supported by the infrastructure like trains and highways. If infrastructure continues to grow and the rent in the outskirts does not skyrocket, more and more people might consider this option over the first one. However, many of these outskirts or satellite towns seem to be more expensive in terms of rent than some Nairobi neighborhoods.
As mentioned before, the new generation of renters does not settle. They want what they want exactly the way they want it. There is also the question of there being so many options that the landlords have no option than to give in and offer more. Landlords are now competing in terms of offerings and rental packages than location and amount of rent. It is expected that more landlords will take up the challenge and offer better living conditions.
Almost half of the Nairobi population is young people. How often will you find young people renting out an apartment building that is unkempt? How often will you find young people living in a building where trash is left lying around? Never. That is because a young person will look at the general aesthetics of the building and make a decision based on that. In some cases, it takes precedence over how much rent is required. It is therefore expected that landlords in the future will want to create more aesthetically appealing buildings. This trend has already been seen with landlords competing on fixtures and other elements of physical appearance.
Many people like to do things online. From ordering groceries to getting their cab rides. Nairobi and Kenya in general, is becoming fully digital with everything moving online. There is actually an app where you can order a cook to come into your kitchen and make you whatever. That means that if landlords want to remain ahead of the game, they have to keep up. In the coming years, more landlords will embrace all the internet everything. All payments and most communications will remain electronic. Landlords will even make more of an effort to advertise online. The real estate sites have seen significant growth in the last few years. This is expected to continue.
These shifts are merely ways for the industry to embrace the new crop of renters while also retaining the old ones. The change will be inevitable for some especially those located in hot zones for specific demographics. These are good changes and are also contributive to putting the Kenyan real estate market at par with the global field.