Airbnb Lifts Nairobi Rents by 10% as Landlords Shift to Short-Term Stays and Push Out Long-Term Tenants

If you’re hunting for a house in Nairobi right now, chances are you’ve come across a beautiful flat, fully furnished, stylish, and available by the night.

That’s the new normal in many of the city’s mid- and high-end neighborhoods. Airbnb has gone from niche to mainstream, and in the process, it’s helping push rents up by 10 per cent, according to new data from Knight Frank.

“About 15 per cent of Nairobi’s housing units have shifted to short-term rentals,” the real estate consultancy said in its Africa Horizons 2025/26 report. “This has driven a 10 per cent rent increase over two years as residents now compete with this new demand.”

The trend is changing more than just property listings. It’s transforming how landlords think about housing—and forcing many long-term tenants to rethink where, and how, they can afford to live.

Landlords Chase Short-Term Profits

For property owners, the appeal is obvious: charge Sh6,000 a night instead of Sh60,000 a month and you’re looking at significantly higher income—if the bookings come through.

“Some landlords are willing to take the risk of a house sitting empty for a few weeks if they believe they can make more overall from Airbnb,” said Mark Dunford, Knight Frank Kenya’s CEO.

That risk, however, may not always pay off.

Data from Airbtics, a firm that tracks Airbnb performance, shows that the typical Airbnb in Nairobi is only booked for 168 nights a year. That’s a 46 percent occupancy rate—meaning properties are empty more than half the time.

“A 46 percent occupancy rate is considered risky,” Airbtics said in a 2025 market update. “A few hosts are making good money, but many are struggling to get consistent bookings.”

Still, in a tight economy, the chance to earn more is enough to keep new listings popping up.

Meanwhile, Real Wages Keep Falling

The problem for renters is that while landlords chase short-term profits, long-term tenants are left with fewer options—and higher prices.

At the same time, their salaries aren’t keeping up. According to the Kenya National Bureau of Statistics (KNBS), real wages dropped by 0.3 percent in 2024, following a much steeper 4.1 percent drop in 2023.

In fact, Kenyan workers have seen their real pay fall every year since 2020. Adjusted for inflation, the average monthly salary shrank from Sh62,256 to Sh55,451 over that period—a loss of Sh6,805 in purchasing power.

When rent rises by 10 percent while income falls, people are forced to make trade-offs: move farther from work, downsize, or share a space they previously had to themselves.

The Airbnb Effect Is Spreading

What’s happening in Nairobi isn’t staying in Nairobi.

In Mombasa, Kisumu, and Nakuru, the short-stay market is also booming. In Nakuru’s Runana Apartments, for instance, two-bedroom units that initially rented for Sh30,000 are now going for Sh37,000—a 23 percent jump in just a year. These units are fully occupied by Airbnb operators charging around Sh6,000 per night.

Knight Frank says this trend will likely continue in tourism-heavy towns, where landlords see better margins with nightly guests than with long-term tenants.

Will Regulation Catch Up?

Unlike cities like New York or Amsterdam, which have introduced strict caps on short-term rentals, Nairobi currently has no dedicated rules or restrictions for platforms like Airbnb. That leaves a wide-open space for landlords to convert residential homes into commercial listings—often to the frustration of their neighbors.

But even Knight Frank acknowledges that this could change. Their report hints that the conversion rate may slow in the years ahead, especially as more families voice discomfort with the idea of sharing their estate with a revolving door of strangers.

“Residents are becoming jittery about short-term guests,” the firm said, noting that the social fabric of some neighborhoods is starting to fray.

Where This Is Headed

For now, Airbnb remains both a blessing and a burden. It offers a new way for landlords and investors to grow income, especially in uncertain economic times. But it’s also adding pressure to a rental market where tenants are already stretched thin by rising costs and stagnant pay.

Without clear policy guidance, Nairobi risks sliding into a situation where homes are seen more as income streams than places to live—and working Kenyans pay the price.

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