QUARTER ONE REPORT

2010

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke
T: +254 20 4446914 | F: +254 20 4447200 | M: 0722 204 765/0733 629 786 | E: info@hassconsult.co.ke
 QUARTER ONE REPORT
2010

Property sellers try for higher prices

in stolid market
! New Hass Lettings Index shows residential rents falling in the second half of 2009, but rising in early 2010.
! Rents for apartments were down over the last two years, only now rebounding while rents for houses
remained stable through 2008, 2009 and 2010.
! In residential property sales, asking prices rose sharply in the first quarter of 2010, after dipping at the end
of last year.
! However, actual closure prices on property sales were almost static in the first quarter.
! Real estate activity across both sales and rentals remained sluggish across the first three months of 2010.
! Together these results show rising confidence by sellers in asking for higher prices, but no supporting
revival in housing demand or closing prices.

Key Points:
THE HASS PROPERTY INDEX THE HAS S INDEX THE HASS INDEX
140 140
YEAR TO Q1 & YEAR TO Q4
INDEX Q1 INDEX Q1
2005 = 100 130 2005 = 100 130

120 120
2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4

Qu ar te r s Quar te r s

THE HASS COMPOSITE THE HASS COMPOSITE SALES INDEX THE HASS COMPOSITE SALES INDEX

SALES INDEX 220 220

YEAR TO Q1 & YEAR TO Q4 INDEX Q1 INDEX Q1

2005 = 100 200 2005 = 100 200

180 180
2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4

Quarters Quarters

THE HASS COMPOSITE THE HASS COM POSITE LETTINGS INDEX THE HASS COMPOSITE LETTINGS INDEX
120 120
LETTINGS INDEX
YEAR TO Q1 & YEAR TO Q4 INDEX Q1 INDEX Q1
2005 = 100 100 2005 = 100 100

80 80
2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4

Quar te r s Quar te r s

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke
T: +254 20 4446914 | F: +254 20 4447200 | M: 0722 204 765/0733 629 786 | E: info@hassconsult.co.ke
 QUARTER ONE REPORT
2010

HEADLINES - HASS PROPERTY INDEX Q1 2010 Q4 2009

Average Price Kshs. 20,433,762 Kshs. 20,080,317

Quarterly % Change +1.8 % +0.4 %

HEADLINES - HASS COMPOSITE SALES INDEX Q1 2010 Q4 2009

Average Price Kshs. 20,927,083 Kshs. 19,476,563

Quarterly % Change +7.4 % -3.2 %

HEADLINES - HASS COMPOSITE LETTINGS INDEX Q1 2010 Q4 2009

Average Price Kshs. 165,720 Kshs. 159,627

Quarterly % Change +3.8 % - 4.5 %

Property sellers and landlords moved to secure higher returns in the first quarter of the year, but with no
evidence of success, as estate agencies reported sluggish demand and closing prices that were up just 1.8 per
cent on the previous quarter.

The marginal first quarter rise in house prices saw them recover to within 0.015 per cent of their levels a year
earlier - in the first quarter of 2009 - confirming a continuing stasis in the market.

Asking prices, however, rose sharply in the first quarter of 2010, by 7.8 per cent, driven substantially by
apartment prices, with evidence of some short-term owners seeking to cash in profits, through price hikes, on
apartments bought for speculative investment, rather than residential use.

It seems unlikely, at this stage, that the market will support the targeted profit taking.

‘It is clear that the market is quite solidly underpinned in holding its current price levels, in both house sales and
in rentals,’ said Fatima Moledina, sales and letting manager for HassConsult. ‘But ambitions to secure profits on
apartments bought as investments within the last two years are likely to remain thwarted for the time-being,
with no areas of shortage or competition for properties, and some significant stocks of unsold properties.’

HassConsult also today launched a new index drawn from more than 20 estate agencies in Kenya showing
trends in rental prices for all residential property.

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke
T: +254 20 4446914 | F: +254 20 4447200 | M: 0722 204 765/0733 629 786 | E: info@hassconsult.co.ke
 QUARTER ONE REPORT
2010

The index revealed a similar stagnation in rental prices, with asking rents at the close of 2009 running at the
exact same level as they were at the beginning of 2007.

However, the first quarter of 2010 saw a renewed push for higher rentals from landlords, again particularly for
apartments.

‘Consumers should be warned that these higher asking rentals and higher asking prices, are to some extent
flying in the face of current levels of availability in the property market, and should take care not to sign up for
overly ambitious pricing.’ said Fatima Moledina.

‘It does not serve the market well to see asking prices move into a renewed surge on the back of such sluggish
demand - setting up the risk of a later market correction, in the form of sharp price falls, and owners who find
they cannot sell for the price they paid.’

‘The market is clearly well supported, but closing prices are unlikely to march upwards until demand is once
again stronger.’

THE
TheHASS INDEX AS
Hass Property ATas
Index 1ST
at 1APRIL
st
April2010
2010
25,000,000

20,000,000
P rice (KS Hs)

15,000,000

10,000,000

5,000,000

0
2005 2005 2005 2005 2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 2009 2009 2010
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

Periods in Quarters

Figures represent middle and upper sector of the Kenyan Real Estate market only

Note: Index represents pure prices changes for an average middle/upper income Kenyan house, which does not actually exist.

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke
T: +254 20 4446914 | F: +254 20 4447200 | M: 0722 204 765/0733 629 786 | E: info@hassconsult.co.ke
 QUARTER ONE REPORT
2010

THE HASS
TheCOMPOSITE SALES
Hass Composite SalesINDEX ASatAT
Index as 1ST APRIL
1st April 2010 2010
250

200

INDEX
150
Q1 2005
= 100
100

50

0
2005 2005 2005 2005 2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 2009 2009 2010
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Periods in Quarters
Figures represent middle and upper sector of the Kenyan Real Estate market only

Note: Index represents pure prices changes for an average middle/upper income Kenyan house, which does not actually exist.

THE HASS COMPOSITE

The LETTINGS
Hass Composite Lettings INDEX
Index asAS
at AT 1ST 2010
1st April APRIL 2010
250

200

150
INDEX
Q1 2007
= 100
100

50

0
2007 Q1 2007 Q2 2007 Q3 2007 Q4 2008 Q1 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1

Periods in Quarters
Figures represent middle and upper sector of the Kenyan Real Estate market only

Note: Index represents pure prices changes for an average middle/upper income Kenyan house, which does not actually exist.

HassConsult Limited | ABC Place, Waiyaki Way | P.O. Box 14090 - 00800 Nairobi, Kenya www.hassconsult.co.ke
T: +254 20 4446914 | F: +254 20 4447200 | M: 0722 204 765/0733 629 786 | E: info@hassconsult.co.ke