Determinants of rent rates in Kenya: a case of Kasarani division in Nairobi county
Abstract
The objectives of the study were to establish the influence of population increase on rent rates,
determine how location of apartments and their proximity to the city influence rent r
ates,
establish the influence of cost of construction on rent rates, assess the influence of structural
characteristics of houses on rent rates and find out how supply of housing influence rent rates in
Kasarani Division, Nairobi County. The design of this
research was a descriptive survey
research. The population for this study was composed of 1500 landlords, 6 representatives in the
ministry of land and planning and 165 property managers.
Simple random sampling technique
was used to select 384 respondents
from the sample.
The study used a semi structured self
-
administered questionnaire to collect data from the landlords and property managers. The study
also used interview guide to obtain answers from representatives in the ministry of land and
planning. Th
e collected data was analyzed using both quantitative and qualitative data analysis
methods. Quantitative method involved descriptive analysis. Descriptive analyses such as
frequencies, percentages were used to present quantitative data in form of tables a
nd graphs.
Data from questionnaire were coded and logged in the computer using Statistical Package for
Social Science (SPSS V 21.0). Content analysis was used for the qualitative data and then
presented in prose. The study deduced that cost of construction
influence rent rates great extent.
The study also established that supply of housing influences rent rates to a great extent. The
study concluded that cost of construction influences rent rates to a great extent. This is because
cost of land, inputs, spec
ialized and casual labour is directly proportional to the cost of
construction, hence, an increase in these costs raise the cost of construction. The study further
concluded that location of apartments and their proximity to the city as indicated by distan
ce
from the CBD, distance from the main road, proximity to other residential buildings, site and
location characteristics of the property and the cleanliness of the neighborhood has an influence
on rent rates. The study recommended that the government shou
ld formulate policies to ensure
that the cost of construction goes down. This is because as the government plans to ensure there
is affordable housing in the country the same can‘t be achieved when the cost of construction is
still high. The study also rec
ommended that the government should ease the limitations
on urban
land to ensure that developers have favourable conditions that will encourage building of more
houses in urban areas to meet the high demand of the same. The tenants too should form a union
to cater for their issues. The general public should be vigilant and allay any illegal rent rate rises
to the authorities. The authorities should also enforce the laws governing rent rates to the fullest.
Publisher
University of Nairobi