The United Kingdom and South Africa have emerged as the most preferred alternatives for wealthy Kenyans seeking to purchase new residential property
Despite domestic property market being the most preferred by High Net Worth Individuals (HNWIs) at 60pc, findings by Knight Frank shows that 25pc prefer to acquire new residential property in the UK compared to 15pc in South Africa.
According to Knight Frank Africa Research Analyst Boniface Abudho, while Kenya remains the destination of choice for the wealthy due to strong confidence and sustained real estate sector activity, the two offshore destinations have are preference due factors such as long term stability and diversified market.
“HNWI now view the property market as both familiar and strategically advantageous which offer perceived stability, long term acquisition potential and better operational oversight compared to peer markets,” said Abudho.
HNWI chose the UK as the second most preferred offshore destination for new residential property due to historical ties, legal and regulatory transparency and perceptions of long term stability.
South Africa on the other hand has been considered by Kenya’s wealthy to it being a more mature and diversified economy as well as a well-developed financial system and sophisticated commercial and residential property markets.
“Investors are making disciplined allocation decisions based on market familiarity, long term asset performance, and the ability to actively manage their investments. While international diversification remains important, domestic investments continue to play a central role in portfolio construction.” he added.
Nonetheless, the Wealth and Investment Trend by the firm shows that Kenyan investors are also shifting their portfolios beyond traditional property markets.
Top investment options include data centres, logistics, Real Estate Investment Trusts, renewable energy and professionally managed rental housing.
“The modern investor is looking beyond conventional asset classes. There is growing interest in investments that combine income, resilience and long term growth. This reflects a more sophisticated approach to wealth creation,” said Mark Dunford, CEO of Knight Frank Kenya.
Knight Frank says the shift to data centre investment has been necessitated by Kenya’s growing digital economy, urbanisation and expanding infrastructure.
For instance, data centres are benefiting from rising demand for cloud computing and artificial intelligence infrastructure, while logistics assets continue to gain momentum on the back of ecommerce growth and regional trade, the property manager stated.
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