Land prices in Spring Valley and Upper Hill grew at the fastest pace last year compared to other high-end Nairobi estates amid a shift in investor appetite towards residential and mixed-use property.
Latest survey report by real estate firm HassConsult for the third quarter of the year shows that the price of an acre of land in Spring Valley shot up 13.3 percent over the last 12 months to an average of Sh305.9 million.
“The strongest growth in Nairobi was in Spring Valley, up 3.6 percent in the quarter, and 13.3 percent in the year, as the area transits from large stand-alone houses to apartments and commercial use,” said HassConsult.
The price of an acre of land in Upper Hill, one of Nairobi’s prime suburbs for commercial and multi-storey residential properties, grew 9.6 percent to Sh554.6 million.
This was attributed to developers snapping up larger plots to convert them to high-rise apartments and mixed-use developments.
“Spring Valley continued to lead, heating up further as developers chased large single-home plots to develop into multi-use properties in line with the rapidly changing character of the area, from exclusively top-of-the-market large homes and gardens to a mixed-use area, with commercial properties and apartments,” said Hass Consult.
“This delivered a further increase in land prices in the suburb of 3.6 percent from June to September and 13.3 percent over the year.”
The strong growth in land prices in Spring Valley and Upper Hill comes amid a slowdown in the overall value of non-residential building plans within Nairobi as investors avoided the pain of oversupply of office space or stand-alone commercial property with diminished foot traffic in a tough economy.
For instance, the value of non-residential building plans in the capital dropped to a 27-month low of Sh1.6 billion in August 2025, levels last registered in May 2023, according to data by the Kenya National Bureau of Statistics.
In contrast, developers in the same month received approvals for home projects worth Sh9.5 billion, up from Sh8.4 billion in July, consolidating a shift in preference among investors.
“If you look at the demand curve, more people are looking for residential to buy than commercial because remember the basic necessity of a human being is food, shelter, and clothing. Before they go to other expenses like office things and the shops,” said Mr Daniel Ojijo, the chairman of Homes Universal.
The rise in land prices comes as a boon for investors in Upper Hill, which has, for close to a decade, suffered a downturn in both land and house prices amid the declining allure of the elevated section of Nairobi where big local firms in insurance, banking and public sectors and several multinationals had set up base.
Upper Hill suffered a hit mainly due to constant traffic congestion, which triggered exits of some large corporations from the area Higher land prices in Spring Valley resulted in increased rental and property values.
“Only areas with strong developer demand are now reporting strong land price growth,” said Sakina Hassanali, co-CEO and creative director at Hass Consult.
Spring Valley posted the second-highest increase in rental prices of 7.4 percent in the last 12 months and 4.1 percent in the quarter to September.
This was behind an annual rental increase of 8.7 percent in Gigiri.
These land price gains and rental yields are now competing favourably against returns in other asset classes, including government securities where annual interest rates touched a high of 14 percent this year gross of tax, but are now seen to be trending downwards.
Annual price increases have been more robust in satellite towns, with Juja (14.9 percent), Kiserian (13.2 percent), Limuru (12.4 percent), and Ruiru (10.5 percent) recording double-digit gains.
The average price per acre remained much lower in the satellite towns at an average of Sh32.3 million, compared with Sh223.9 million in the 18 Nairobi suburbs at the end of September 2025, leaving some areas of the city only accessible to a few well-heeled developers.
Upper Hill and Westlands remained the most expensive locations in the city in terms of land prices at an average of Sh554.6 million and Sh504 million per acre, respectively.
Parklands (Sh465.6 million), Kilimani (Sh422.8 million), and Muthangari (Sh400.9 million) also averaged above the Sh400 million mark.
