Land Prices Fall in Kenya's Coastal Towns Despite Strong Demand for Beachfront Property

Land prices in several coastal towns declined slightly in the final quarter of 2025, although areas such as Diani and Lamu continued to record growth, according to the latest Hass Property Index.

In Bamburi, Mombasa, land values fell by 1.1 per cent between October and December, marking one of the steepest quarterly declines along the coast. Despite the drop, the suburb has recorded a 56.6 percent increase over the past five years. The average price of an acre now stands at Ksh57.9 million, while beachfront land is valued at about Ksh97.4 million.

Mtwapa also recorded a 1.0 percent decline during the quarter, affecting nearby beach areas such as Jumba La Mtwana. Land prices in the town average Ksh37.9 million per acre, with beachfront plots valued at Ksh44.4 million.

Mombasa City, including English Point, Nyali and Shanzu, posted a similar quarterly decline of 1.0 per cent. However, the city has still achieved five-year growth of 38.3 per cent. Land prices average Ksh91.3 million per acre, rising to Ksh120.3 million for beachfront property.

Watamu, which includes beach areas such as Garoda and Jacaranda, recorded a smaller decline of 0.5 percent. Property analysts linked the changes to several factors, including demand from diaspora investors, tourism-related purchases, lifestyle migration and the premium attached to beachfront land. 

Environmental issues such as coastal erosion, flooding risks and access to water also continue to influence property values. Other coastal towns recorded gains during the quarter. Diani posted the strongest growth at 2.3 percent, with average land prices reaching Ksh36 million per acre and some estates valued at up to Ksh65 million. 

Lamu Island followed with a 1.8 percent increase, maintaining its position among the most expensive property markets on the coast. Malindi, Kikambala, Shanzu and Nyali also recorded growth ranging between 1.0 and 1.5 percent.

Sakina Hassanali, Co-Chief Executive and Creative Director at HassConsult, said coastal land prices had become increasingly independent from broader economic trends in Kenya during the 2020s. She attributed this shift to remote working, retirement migration and sustained demand from both local and international buyers.

She added that unresolved land ownership disputes, weak infrastructure and water shortages continued to limit investment in parts of Kilifi and Kwale counties.