Nairobi rental yields by neighbourhood in 2026
Indicative gross yields for Nairobi's main residential zones, how to turn them into a net figure, and the tax and cost lines that quietly eat two points off the top.
A rental yield is a simple ratio: annual rent divided by what you paid. The trouble is that almost every yield quoted in a listing is gross, based on asking rent, and assumes the unit is never empty. The ranges below are indicative and compiled for illustration; check them against current listings in the zone you are considering. They are followed by the maths to bring a gross figure down to a number you can actually bank.
Indicative gross yields, mid-2026
Treat these as ranges rather than promises. Within a single street, finish quality, floor level and whether parking is included can move a yield by a full point.
- Kilimani, Kileleshwa, Lavington (apartments): 5 to 6.5 percent. Heavy supply of new two-bedroom stock has held rents flat while purchase prices stayed high.
- Westlands, Parklands: 5.5 to 7 percent, with the upper end for furnished units let to corporate tenants on short leases.
- Ruaka, Kiambu Road corridor: 6 to 7.5 percent. Prices are lower than the inner suburbs while rents track close behind them.
- Syokimau, Athi River, Kitengela: 7 to 8.5 percent. Land is cheap, so the build cost dominates the price and yields look strong. Vacancy is the risk here.
- Kasarani, Roysambu, Thika Road: 7 to 9 percent on studio and one-bedroom stock aimed at young professionals and students.
- Karen, Runda, Muthaiga (stand-alone houses): 3.5 to 5 percent. These are capital-growth and lifestyle purchases, not income plays.
- Ngong Road, South B, South C: 6 to 7.5 percent on older, well-located stock that is cheaper to buy than to replace.
From gross to net: the lines that matter
Take a two-bedroom in Kilimani bought at KES 12 million and let at KES 65,000 a month. Gross yield: 780,000 divided by 12,000,000, or 6.5 percent. Now subtract:
- Vacancy. One month a year is a fair assumption for well-managed stock; two months for oversupplied zones. At one month, income drops to KES 715,000.
- Service charge. Owners pay this whether or not the tenant does. Budget KES 5,000 to 12,000 a month for a lift building with a generator and borehole; KES 96,000 a year in this example.
- Land rates and ground rent. County rates on a sectional unit are small but not zero; allow KES 10,000 a year.
- Management. Agents charge 5 to 10 percent of rent collected. At 8 percent, that is roughly KES 57,000.
- Repairs and replacement. Water heaters, taps, repainting between tenants. One percent of value a year is prudent on new stock; KES 60,000 here, more on older units.
- Tax. Residential rental income between KES 288,000 and KES 15 million a year is taxed under the Monthly Rental Income regime at 7.5 percent of gross rent, with no deductions. On KES 715,000 collected, that is about KES 53,600. Appointed agents withhold this at source.
Net income: roughly KES 438,000, a net yield of 3.7 percent on a headline 6.5. That is the number to compare against a fixed deposit or a government bond, not the listing figure.
What moves yields up
- Buy below replacement cost. Older buildings in South B or Kileleshwa often trade below what it would cost to build them today, which is why their yields beat new towers next door.
- Furnished, serviced lets in Westlands and Kilimani can push gross yields past 9 percent, but you inherit hotel-style costs: cleaning, utilities, linen, platform fees and much higher vacancy.
- Parking and a backup water supply are the two features tenants pay a measurable premium for. A unit without either will rent last and turn over first.
- Commercial rent attracts VAT at 16 percent and is taxed as normal business income rather than under MRI, so mixed-use conversions need their own calculation.
What moves yields down
Oversupply is the quiet killer. Between 2019 and 2025 tens of thousands of apartments were completed in Kilimani and along Kiambu Road, and rents in those zones have barely moved in nominal terms while service charges rose with fuel and electricity costs. A yield calculated on today's asking rent in a zone with fifteen cranes on the skyline is optimistic.
The only honest yield is one calculated on rent you can prove was actually paid on a comparable unit, less every cost you will be liable for even in an empty month.
If you want the calculation run on a specific unit, send us the listing. We will come back with a net figure and the assumptions behind it, and the assumptions are where the argument should be.
