Nairobi Construction Costs Fall Due to Stabilizing Material Prices

Construction costs in Nairobi have eased significantly this year as prices of key building materials stabilized, offering relief to developers and contractors. The decline has been attributed to falling costs of steel, bitumen, and cement, which had previously driven up project expenses across the city. This stabilization is expected to encourage more investment in housing, infrastructure, and commercial projects.
In April 23, 2025, the Kenya National Bureau of Statistics (KNBS) reported that the Construction Input Price Index (CIPI) fell by 0.3% in Q1 2025 compared to the previous quarter. Year‑on‑year inflation in construction inputs slowed sharply to 0.18%, down from 3.56% in Q1 2024. The biggest contributor to the decline was steel and reinforcement bars, which dropped by 2.16%, easing costs for large‑scale projects.
By November 18, 2025, KNBS data showed that construction costs remained relatively stable in Q3, with inflation at just 0.74% year‑on‑year. While prices of bitumen and electrical fittings rose slightly, declines in timber and cement balanced the overall index. Analysts noted that improved supply chains, local sourcing, and a steady currency helped reduce volatility in the sector, making construction more predictable for investors.