5 December 2012

Kenya: Kisumu Houses Stay Vacant, Tenants Elusive

Landlords in Kisumu may have to lower rents in the near future as tenants devise ways to beat costly rents, leaving many houses vacant.

Many landlords had in recent months raised rents in the lakeside city on the back of hyped demand hoped to arise from ongoing infrastructural upgrade projects including the airport and roads.

A spot-check by the Star however revealed an increasing number of vacant houses, throwing into disarray hopes by landlords to recoup their investments sooner.

Statistics from the City Council of Kisumu put housing demand to 15,000 units annually, but fears are growing that there may be oversupply that has created dead stock.

Muzungu Tumbo of Sparknet Auctioneering Services said there is growing pessimism from investors as most first-time developers find the going tough.

"Many people took the opportunity of the housing shortage thinking they were alone but now that every unit is up, the high returns envisaged by the investors are elusive," he said.

Rents have risen by about 30 per cent in the past year as landlords hoped to make a quick buck.

A trend is however emerging whereby several tenants are huddling up to occupy large, spacious units and share rents to beat the rising cost of living. Others are also opting to move down the property ladder by taking up smaller, cheaper units.

Property consultant Harold Ayodo said massive reduction in rental prices may be in the offing as landlords seek to lure elusive tenants.

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