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XINHUA NEWS SERVICE REPORTS FROM THE AFRICAN CONTINENT

 

Land prices in rural towns across Kenya have hit an all-time high

NAIROBI (Xinhua) -- The cost of land in towns in rural Kenya has hit an all-time high following a huge demand thanks to devolved government.

The price, especially in towns hosting county headquarters, has increased five-fold in the last few years as population surges in the regions.

Among towns where land prices have increased tremendously are Nyeri, Nakuru, Kakamega, Kisumu, Busia, Bungoma and Eldoret.

Some five years ago before the onset of county governments, one would buy a quarter acre on the outskirts of the towns at between 4,854 U.S. dollars and 14,563 dollars depending on the proximity to trading centres.

But this has changed, with eighth acre in the towns currently going for between 14,563 dollars and 48,544 dollars, the highest climb ever to be recorded.

"There is huge demand for land from property investors seeking to build both commercial and residential houses.

"This demand has been pushed up by the influx of people from other places to the towns in search of opportunities," Moses Aseka, a land dealer in Kakamega told Xinhua in a recent interview.

Aseka acknowledged that the cost of land in the town, one of fastest growing in western Kenya, has increased significantly, with the asking price for an eighth acre on the outskirts of the county headquarters hitting 48,544 dollars.

All the county headquarters across the East African nation are experiencing boom resulting from jobs created by the devolved units and small businesses.

Devolution, according to analysts, has opened up various towns, attracting state agencies like construction authority, anti-graft commission, Judiciary and ombudsman, which have set up offices in the towns.

Private investors and entrepreneurs, who include proper developers, have similarly flocked the towns in such for the boom.

The influx has, therefore, has created a huge demand for office and retail space and commercial and residential buildings to host all the investors and government officials.

Apart from the devolved units, there is improvement of road network by both the national and county governments linking different places and opening up areas that initially were inaccessible to investors.

Universities have also set up campuses in the towns leading to huge population of workers and students.

Antony Kuyo, a consultant with Avent Properties, which recently opened a branch in Kisumu town, said land prices have hit an all-time high.

"The good thing with the property market is that even as prices surge, there are so many willing buyers.

"You miss one, you get another.

"In the last two months we have been selling for a client 16 plots subdivided from two acres for a gated-community.

"Each goes at 15,533 dollars and nearly half are booked," said Kuyo.

Cytonn, a Nairobi-based investment firm, noted that rental yields in the towns are also on the rise for both commercial and residential properties.

Rental yields in Nyeri, Mombasa, Kisumu, and Nakuru stand at between 9.6 percent and 13 percent for commercial properties and 4.1 percent to 6 percent for residential.

The huge returns are pushing up investment in residential houses.

In the capital Nairobi in 2017, real estate firm HassConsult in a report last month, noted that land prices in the suburbs increased by 3.3 percent while in satellite towns, in the counties bordering the city, by 5.4 percent.

           

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