Market prices for luxury property in Nairobi and Mombasa rose by the highest margins globally last year, defying a weak global economy and high lending rates, a new research report shows.
The Wealth Report 2012 by Knight Frank and Citigroup’s subsidiary, Citi Private Bank, showed that Nairobi and Mombasa prices rose by 25 per cent and 20 per cent respectively – earning the two cities the first two positions of the 71 cities surveyed worldwide.
“Price growth in both the Kenyan capital Nairobi and the country’s Indian Ocean coastal hot spots outstripped all other Prime International Residential Index locations, with Nairobi property chalking up a 25 per cent increase last year,” said the wealth report.
According to the report, Nairobi and Mombasa were the only cities in the southern hemisphere to have recorded double-digit property price surge.
Other cities that recorded high margins include Miami (19.1 per cent), Bali (15 per cent), Jakarta (14.3 per cent), London (12.1 per cent), Vancouver (10.4 per cent), Moscow (9.8 per cent), Toronto (8.5 per cent) and Beijing (8.1 per cent).
The report quoted the MD of Knight Frank Kenya, Ben Woodhams, as saying that the surge in Kenya’s property prices was largely attributed to increased demand occasioned by economic growth and infrastructure development in the country, which have attracted local and international capital flows.
The wealth report, however, said Nairobi and Mombasa were not likely to experience property price rally in the long-term due to the rising security concerns and uncertainty over lending rates.
