Top Six Estates to Invest on Residential Apartments in Nairobi

A newly released report has named the top estates to invest on apartments in the Kenyan  capital, Nairobi and surrounding areas.

The Nairobi Metropolitan Area Residential Report 2017/2018 released by Cytonn Investments listed Kilimani, Westlands and Thindigua as the three most profitable estates in Nairobi for residential apartment investors.

Cytonn said the areas recorded double-digit total returns on apartments, attributed to good infrastructure and accessibility to locations where most people work, such as the Nairobi central business district, Upperhill, and Westlands.

"Apartments registered higher returns to investors of on average 8.7%, 0.5% points higher than the market average of 8.2%. This is attributable to high demand for high rise units, mainly due to their affordability," Cytonn said in its Nairobi Metropolitan Area Residential Report 2017/2018.

Ruaka, Upper Kabete and South B/C took the fourth, fifth and sixth positions respectively for apartment development, registering average returns of 11.1%, 11.9% and 10.1% p.a respectively.

On the other hand, Karen, Runda Mumwe and Ruiru are listed as the best estates to invest for detached units’. Ruiru recorded the highest returns in the detached units category, with total returns of 11.7% p.a.

Cyton named attractive demographic profile, increased household incomes, improving infrastructure, and government incentives as some of the factors that continue to drive the residential sector.

Key challenges in the development of residential sector include increasing land costs, inadequate infrastructure, and limited access to funding.