NAIROBI (Xinhua) – Increased competition for tenants against a backdrop of rise in supply of houses in Kenya’s capital Nairobi has seen property owners come up with incentives to lure tenants and increase rental yields.

Property owners are offering additional amenities like satellite TV, internet services and CCTV cameras, for security purposes, to attract new tenants and dissuade existing ones from moving out. Some property owners are mulling with the idea of installing piped cooking gas in their houses, as it is done in the developed world, after a company announced early this year it is going to start the service.

The house developers are targeting buyers and tenants in upper- middle and upper class markets and residential areas. But as the practice picks fast in high-end areas, tenants in lower-middle class estates are also being lured with the amenities as property owners renovate their houses and fit in the services to justify rent increases. A newly constructed residential area along Thika superhighway is among estates with these additional services.

What makes the houses stand out is that tenants and property buyers also benefit from modern security comprising of CCTV cameras and all the units are fitted with fibre optic cable for internet access. The estate has 840 housing units consisting of two, three and four-bedroom apartments. Two bedroom houses go for 66,444 U.S. dollars. Similarly, three and four bedroom apartments go 76,444 dollars and 99,777 dollars. Other houses with similar facilities are in high-end areas like Kilimani, Westlands, Runda, Karen and Kileleshwa.

The districts are also frequented by expats. The houses which target short term visitors and tenants are rented at between 1,500 dollars and 1,650 dollars a month. There are also daily and weekly rates for short term visitors. But as property developers in exclusive suburbs offer an array of additional services to entice tenants, those in low-end markets are mainly installing pay TV services for tenants. They are riding on Kenyans love for sporting actions, especially the English Premier League.

Bernard Anjeche, a marketer with a manufacturing firm in Nairobi, lives in a flat where the landlord installed pay TV service recently. The flat located in Zimmerman, a residential area on the outskirts of Nairobi, has two and three bedroom houses. He pays 162 dollars monthly as rent for his two bedroom unit.

“The building has ten houses and each is connected to pay TV,” said Anjeche on Monday. “The landlord renovated the house and installed the service to lure customers,” he added. Anjeche confessed that he moved into the house because of the pay TV service. “Initially, I was staying in Donholm, Eastlands. Then I wanted to relocate to an area along Thika superhighway so that I can forget about traffic jams. A friend helped me look for the house, and after comparing it with others, the satellite TV service made me move into it,” he said.

According to Anjeche, the landlord does charge tenants for the additional service. “We have never been asked directly to pay for the service but I know in a way we pay for it in our rent,” he said. Wilfred Njuguna, a house owner and real estate agent in Komarock, Nairobi, noted that most tenants today want houses to have additional services beyond the basic ones like water and electricity.

“Initially, when potential tenants searching for houses came to me, most of them used to ask whether a house has water, electricity and security, but today, some of them are asking whether a house has satellite TV,” he said. He noted that installing satellite TV and maintaining it does not cost a house owner a lot of money that can warrant high rate charges.

“One can still maintain ‘normal’ rent charges depending on neighbourhoods but offer the service since all one needs is to put up the dish and wire it to all the houses. This is good since it also prevents each tenant from mounting antennas that makes flats cluttered,” he said. Hass Consult, a real estate development firm, in its property index released this year noted that rental yields for house owners in Kenya were going down, especially in Nairobi, as tenants seek cheaper houses.

“We are seeing a trend across all sectors of the market of householders shifting to cheaper housing options,” said Ms Farhana Hassanali, property development manager at real estate firm. “The shift comes against a backdrop of squeezed household budgets on inflationary pressures and near static pricing in housing,” she added. The turn of events has, therefore, made landlords look for other creative ways to get tenants and retain them.

On the flipside, however, provision of additional services, according to experts, has also made some property owners overprice their houses. For instance, in some areas in Nairobi, a three-bedroom house, fitted with internet and CCTV cameras, among other services, is being sold at 180,722 dollars. The same house is rented for about 800 dollars a month. (Xinhua)


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