Africa’s super rich prefer investing in Kenya’s property market, a 2018 Wealth Report compiled by real estate consultancy firm Knight Frank has revealed.
Kenya also emerged third after UK and US as the location where rich Africans would wish to invest in the property sector.
The Wealth Report 2018 shows that 24 per cent of the ultra-wealthy Africans own property in the country and plan to increase their portfolio. Sixty seven per cent of the super rich Africans have invested in the UK while 33 per cent have interest in the US market.
South Africa is the fourth favourite property investment location for Africa’s super-rich at nine per cent. The report further shows that 21 per cent of Africa’s super-rich are considering buying homes in Kenya.
“The fact that Kenya is the top African investment destination of choice for HNWIs on the continent speaks volumes about the strength and growth potential of our property market,” said Ben Woodhams, managing director at Knight Frank Kenya.
Property makes up 43 per cent of Kenya’s HNWIs investment portfolios, excluding primary residences and second homes. This averages higher than their African counterparts’ 39 per cent.
The report also shows an interesting trend in Kenya where only ten Kenyans cumulatively control assets worth more than Sh500 billion, indicating the widening gap between the rich and the poor.
The report collects data through interviewing fund managers and wealth advisers who manage the assets of high-net-worth individuals across the country.
Kenya’s property market has been booming in recent years but tough economic times have seen prices of prime residential property in Nairobi weaken 0.9 per cent in 2017 and 2.1 per cent in 2016.
An oversupply in the market has also been blamed for the slumping prices.
“The opportunities to buy properties and then sell them at a handsome return are becoming thinner as prices have become static over the last few years,” notes a 2017 HassConsult report.