The satellite town of Ruaka has experienced a land price boom over the last one year, a new report shows, based on quotations from real estate firms, agents and individual land owners.
The report by land-buying firm, Property Reality Company, attributes the jump in prices largely to heavy infrastructure development in Kiambu county. This includes the construction of the Northern Bypass four years ago, and increased housing development.
The Land Index Report by PRC indicates the average price for an eighth of an acre in Ruaka rose from an average of Sh8 million in June 2015 to Sh18 million, an increase of 125 per cent.
However, land prices in the rest of Kiambu appreciated by three per cent from Sh3.8 million per eighth of an acre to Sh3.9 million over the same period.
Other areas that recorded rapid appreciation in land prices were Kiserian and Utawala.
The report shows the price for eighth of an acre in Kiserian increased by 42 per cent from Sh600,000 to Sh850,000, while the same size of land in Utawala recorded an increase of 32 per cent from Sh1.1 million to Sh1.45 million.
“Ruaka, Kiserian and Utawala experienced the highest price increases. Access roads, electricity, beacons and water remain important value addition avenue,” the report states.
It shows land prices rose moderately in Ngong, Kajiado, Ongata Rongai, Mlolongo, Isinya, Oletepesi, Kantafu, Syokimau, Muguga, Kisamis, Joska, Malaa, Athi River, Kitengela, Thika, Ruai, Kikuyu, Kiambu, Konza, Ruiru and Juja.
Land prices stagnated only in Kamulu and Malili towns.
According to PRC, the survey compared prices for 330 parcels of land, while the data was collected through field visits by trained researchers and comparisons using online databases.
The real estate firm said the demand for land in satellite towns has also been boosted by an increase in financing options, adding that buyers will increase significantly due to the incentive offered by the law capping interest rates.
This is in addition to an increase in the proportion of real estate firms offering installment purchase of property.
“Eighteen per cent of real estate companies have financial partners on board, with banks and saccos most used. The reduction in interest rates charged by banks is welcome incentive for real estate firms to partner with financial providers to offer loans,” the company said.
– The Star
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