Real Estate valuation in Nairobi is not necessarily determined by the cost and sale prices of a
property. There are other determining factors that either decrease or increase the value of a
property.
One of the many factors includes the market condition. The demand for properties and the
scarcity of properties generally affect the buyer’s or seller’s market. This either adds or takes
away from the Real Estate valuation for properties in Nairobi.
For example, when there is high demand for homes, where the availability of the houses is
scarce, this influences the seller’s market. Eventually, the property’s value is boosted.
The cost approach is also a varying factor that influences the real estate valuation for properties
in Nairobi.
The cost approach values a property and the land it sits on. The assumptions are always that a
rational buyer wouldn’t pay more for the property than its cost to build something similar.
Most importantly, it takes in the fact that the land can never depreciate.
Where a property is located is the most important driver of its price and value. Certain markets
have higher real estate prices because of limited supply and strong demand. You cannot
compare properties’ values in Parklands, Westlands, Kilimani, and those that are in Ruaka,
Kitengela, etc.
Each real estate market undergoes temporary ups and downs, and these can majorly affect
property values. A generally cheap market might see price increases due to a shock and vice
versa.
Some types of properties have greater value than others. For example, duplexes, and
condominiums, are more expensive especially if they are bigger and with more bedrooms and
bathrooms.
When a house is new and well-maintained, it will always be more valuable. Furthermore, if it
has distinguishable home improvements that add to style and comfort, this will most definitely
boost the value of a residential real estate property.
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