Why Land Prices in Nairobi Satellite Towns Like Ruaka and Rongai Are Stagnating

Nairobi's satellite towns, which have been a hotspot for land buyers in recent years, are now experiencing a stagnation in land prices.

Data by real estate firm, HassConsult, for Q2 of 2025 shows that Nairobi suburbs beat satellite towns in land price gains for the first time in 5 years.

This trend has been attributed to 3 factors, including buyers' preference, tough economic times for the middle class, and caution among developers 

Among the satellite towns that recorded stagnated growth were Ruaka and Rongai, with a price change of +0.1% and +1.1% respectively. Some satellite towns even recorded negative growth, including Kiambu (-0.4%) and Thika (-0.2%) respectively.

Conversely, land prices in suburbs such as Parkland and Spring Valley saw a growth of over 2%.

“Land price per acre in Nairobi's suburbs rose by 1.6% in the second quarter, slightly slower compared to a growth of 1.7% in quarter one, while the satellite towns saw their prices appreciate by 1.25%, slowing down from a growth of 2.4% seen in the previous period. 

“All 18 suburbs surveyed in Nairobi returned positive price movement in the quarter. However, Spring Valley (2.3%) and Parklands (2.2%) were the only two suburbs with a price gain of more than 2%.”

‍3 Factors Behind the Current Trend‍

1. Tough Economic times among the middle class

In recent years, the middle class has been among the top buyers of land in satellite towns. However, the current tough economic times have hit them hard, further affecting their plans to buy land within the satellite towns.

“As economic conditions become tougher for the middle and upper middle class, the previously high demand for land in Nairobi's outlying areas, where prices were within reach of private home developers, is waning, leading to lower growth in areas such as Kiserian, Kitengela, Ngong, Ongata Rongai, Juja, and Thika,” read the report in part.

Unlike the suburbs, land within the satellite towns is affordable for the middle class, with most of the land prices ranging between Ksh18 million to Ksh50 million per acre (depending on the location).

2. Caution Among Rental Developers‍

Developers are also cautious of the oversupply of rental units within the satellite towns. Therefore, very few are buying land in the satellite towns to invest.

“Developers are also keeping an eye on potential oversupply of apartments in these satellite areas, which has started to manifest in stagnant rental prices and falling sales prices for units in a majority of the towns,” HassConsult CEO Sakina Hassanali stated.

3. Preference Among Buyers ‍

The suburbs have witnessed increased demand among Kenyans who prefer to build standalone houses in densely populated areas.

“The Nairobi suburbs have shown consistency in price movement, allowing them to overtake satellite towns in quarterly price growth for the first time in five years,” HassConsult CEO added.

“Demand for standalone house units also bodes well for land prices in low-density estates, complementing the city's bright apartment development hotspots.”