The price of residential houses stabilised as demand softened during the first quarter of the year.
Kenya
Bankers Association (KBA) Housing Price Index released Thursday showed
that the average house price increased marginally by 1.10 per cent
during the first three months of the year compared to the 1.58 per cent
rise during Q4 of 2016.
“Whereas this supports the
observation that house prices are broadly stable, it is increasingly
becoming evident that prices are softening.”
“The house
prices evolution since the third quarter of 2016 represents a downward
trend, being a reversal of the rising trend that prevailed from the
preceding three quarters starting from the fourth quarter of 2015,” said
the KBA housing index.
The index showed that supply
and demand dynamics have equally influenced the general house prices
trend, the key driver of the softening seen during the Q1 of 2017 and
the preceding two quarters leaning more towards market demand
conditions.
“Demand has somewhat been suppressed
principally because of reduced lending by commercial banks following the
enactment of interest capping law in the last quarter of 2016,” the
index stated.
Apartments accounted for 75.72 per cent of the total number of units sold in Q1 of 2017
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