Kampala’s apartment market continues to expand with rising demand from professionals, expatriates, diplomats, investors and Ugandans in the diaspora. New developments across Kololo, Naguru, Nakasero, Bugolobi, Bukoto, Muyenga and Mbuya offer modern apartments with gyms, swimming pools, backup generators, biometric access and secure parking.

As the sector grows, many clients ask the same question. Should you rent or buy an apartment in Kampala? This guide uses real statistics and market trends to help you decide.

Kampala’s Apartment Market in Numbers

• Kampala’s urban population is growing at approximately 4% per year, increasing housing demand.

• About 80% of apartment rentals are located in Kololo, Nakasero, Naguru, Bugolobi, Bukoto and Mbuya.

• Rental yields for apartments in prime areas range between 7% and 10% annually.

• Apartment prices in central Kampala have appreciated by 5% to 10% per year over the last 5 years.

  Fully furnished apartments in Kololo and Nakasero earn between $1,500 and $4,000 per month.

• Demand for modern units has increased significantly since 2020 as more residents prefer secure, serviced apartments.

Benefits of Renting an Apartment in Kampala

1. Flexibility

Renting gives you the freedom to move when your job or personal needs change. About 60% of expatriates and diplomatic staff prefer renting due to short-term assignments.

2. Low Initial Cost

Renting requires only 1 or 2 months’ rent plus a security deposit, making it suitable for professionals and clients who do not want to commit large capital upfront.

3. Access to Prime Areas

Buying an apartment in Kololo or Nakasero can cost between $200,000 and $1,200,000. Renting provides access to these locations without the full purchase cost.

4. Maintenance Covered

Around 85% of landlords handle major repairs, making monthly living costs predictable for tenants.

Benefits of Buying an Apartment in Kampala

1. Long-Term Capital Growth

Prices in prime areas have increased by 5% to 10% annually, making apartments strong long-term assets.

2. Valuable Rental Income

Average monthly rents by location:

• Kololo: $1,500 – $4,000

• Nakasero: $1,200 – $3,500

• Naguru: $1,000 – $2,500

• Bugolobi & Mbuya: $800 – $2,000

Investors earn rental yields of 7% to 10%, especially on furnished units.

3. Stability

Ownership protects you from rent increases and landlord decisions. It is ideal for long-term residents, families and returning Ugandans in the diaspora.

4. Hedge Against Inflation

Uganda’s inflation has averaged 5% to 8%. Real estate typically outpaces inflation, making apartments a reliable wealth-preserving asset.

Cost Comparison: Renting vs Buying

Renting

• Lower upfront cost

• No long-term financial commitment

• Suitable for stays under 3 years

• Best for expatriates, consultants and short-term professionals

Buying

• Higher upfront cost but better long-term value

• Mortgage rates range between 16% and 19% depending on lender

• Buying becomes cheaper than renting after 3 to 7 years, depending on location

A tenant paying $2,000 per month spends $24,000 per year. After 5 years, that equals $120,000, enough to purchase a good mid-range apartment. This is why buying often becomes more economical for long-term residents.

Who Should Rent?

Renting is ideal for:

• Diplomats on rotational assignments

• Expatriates on 1 to 3-year contracts

• Students and young professionals

• Clients testing neighbourhoods before buying

• Individuals prioritizing convenience over permanence

Who Should Buy?

Buying is ideal for:

• Long-term Kampala residents

• Investors seeking rental income

• Ugandans in the diaspora

• Families needing stable housing

• Individuals tired of rising rent in prime areas

• High-net-worth investors seeking diversification

Best Areas to Rent or Buy Apartments in Kampala

Best Areas for Buying

Kololo
Naguru
Nakasero
Bugolobi
Mbuya
Muyenga
Bukoto

These locations offer strong appreciation and high rental demand.

Best Areas for Renting

Kololo
Nakasero
Naguru
Bukoto
Lower Muyenga
Kisaasi
Kiwatule
Bugolobi

These areas offer convenience, amenities and a wide range of rental budgets.

Final Verdict: Rent or Buy?

Renting offers flexibility and low entry cost. Buying offers long-term financial gain, stability and passive income. If you plan to stay in Kampala for more than 3 years, buying generally becomes the more rewarding option.

Work With Kawe Realtors Uganda

Kawe Realtors Uganda specialises in apartments for sale and rent across Kololo, Nakasero, Naguru, Bugolobi, Muyenga and Mbuya. Whether you want to rent, buy or invest, we provide professional guidance, verified listings and tailored real estate solutions.

Contact us today to explore the best apartments for rent or for sale in Kampala.