News Column

Mlolongo Disappoints Investors With Low Yields

January 29, 2014

James Waithaka

Real estate investors who have property in Mlolongo have emerged a disappointed lot in the market as rents and houses prices in the location fail to rise as expected. While other estates off Mombasa Road such South C and South B topped the rental and house price charts in 2013, Mlolongo "stood out as a beacon of strategic disappointment", according to real estate firm HassConsult. It said the location has not offered both homebuyers and tenants adequate comfort to compensate for the considerable extra commuting time, seeing that builders have constricted spaces (and house sizes) and overpriced their units versus a not-so-glamorous lifestyle offering. The firm gave the harsh verdict after its survey showed rents in Mlolongo rose by four per cent last year, when South C and B recorded 20 per cent and 19 per cent respectively. Average rents moved up from Sh24,000 to Sh25,000 in Mlolongo. "It is vital to understand market positioning and demand trends in property choices and investment. It is not at all the case that all property earns good returns," said Sakina Hassanali , head of research and marketing. "Property in areas that are up and coming, or that satisfies real and current shortages, or that correctly foreshadows future needs -- all such properties continue to rise in value and pricing. But ill-conceived projects, and properties in areas of lesser demand, can even experience price falls," she said.

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Source: AllAfrica

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