Kenya has been ranked the property market of choice for the continent’s super-rich.
According to the Wealth Report 2018 by Knight Frank, nearly a quarter (24 per cent) of the ultra-wealthy Africans own property in the country and plan to increase their portfolio.
Overall, Kenya ranks third as the most preferred real estate investment destination by high-net-worth individuals from Africa, behind the UK, which ranks first with 67 per cent of the wealthy Africans owning property there, and the US (33 per cent) in the second position. In Africa, however, Kenya is the top destination ahead of countries such as South Africa, which was ranked fourth.
“South Africa is the fourth favourite property investment location for Africa’s super-rich at nine per cent. In total, four per cent of the world’s super-rich already own property investments in Kenya led by African, North American, Europeans, and Asian HNWIs (high-net-worth individuals),” says the report, which further notes that 21 per cent of Africa’s super-rich are considering buying homes in Kenya.
A total of three per cent of the world’s HNWI population is looking to buy houses in Kenya this year, with the majority being from India.
The attractiveness of Kenya’s real estate market by Africa’s super-rich has over time resulted in inflated property prices.
According to the report, prices of property in areas such as the Karen suburb have gone up to over Sh50 million an acre from Sh2.3 million two decades ago.
Economic hardships over the past two have, however, seen prices of prime residential property in Nairobi weaken 0.9 per cent in 2017 and 2.1 per cent in 2016.
“The fact that Kenya is the top African investment destination of choice for HNWIs on the continent speaks volumes about the strength and growth potential of our property market,” said Ben Woodhams, managing director at Knight Frank Kenya.
Property makes up 43 per cent of Kenya’s HNWIs investment portfolios, excluding primary residences and second homes. This averages higher than their African counterparts’ 39 per cent.
The majority of Kenya’s super-rich (59 per cent) have invested in real estate.