Thursday, July 25, 2013

How to Buy Land in Kenya

Buying land in Kenya is not for the faint-hearted. The process can be long winded and there are many issues to consider. Most of all, you need to protect yourself from the horde of fraudsters keen on seeing you part with your hard earned money.

Land in Kenya is either Freehold and Leasehold. Non-citizens can only buy leasehold land. All leases for leasehold land have a maximum 99-year lease under the 2010 Constitution of Kenya.





Steps to buy land in Kenya

  1. Step one - Identify the piece of land that you would like to purchase. You can enlist the services of a real estate agent to help you in this regard. You will also need a land surveyor to verify size among other technical issues. 
  2. Step two - Perform a land search. This will verify ownership, size and if there are any legal encumbrances such as court orders, prohibitions, cautions and the like. Find out how to perform a land search online on eCitizen. 
  3. Step three - Hire a lawyer. Many people think they can bypass a lawyer so as to save money but this is usually a big risk and you could end up losing more than the legal fee. The lawyer will conduct a search at the Lands office.
  4. Step four - once your lawyer ascertains the land details, he will proceed and prepare a sale agreement. The agreement will specify the parties and other purchase terms. You and the seller will sign the agreement in the presence of witnesses who will also append their signatures on the agreement. In most cases, you will be required to pay 10% of the sale price upon signing the agreement and the balance within 90 days. The sale agreement has to be stamped to give it legal effect; the stamp fee is KES 200 for the original agreement and KES 20 for every copy.
  5. Step five - the seller obtains consent to transfer the land from the relevant Lands office. 
  6. Step six - when ready to transfer the land, an application for valuation needs to be made so that the Government valuer may visit the land and prepare a valuation report. This is done for the purposes of payment of stamp duty which is based on the value of the land.
  7. Step seven  - pay the stamp duty. This is the responsibility of the buyer. The current rate of stamp duty is 2% of the value in accordance with the valuation report. The stamp duty is paid to the Commissioner of Domestic Taxes by depositing the same at their bank account in National Bank, Kenya Commercial Bank or any other appointed bank. Following payment, lodge the documents at the Lands Office in your County for stamping and embossing.
  8. Step eight - the seller should then present the following documents to the Lands office for registration 
    • Title deed
    • Land rent
    • Rates clearance certificate (for leasehold land)
    • Valuation report
    • Consent to transfer
    • Stamp duty declaration
    • Pay-in-slip

The lands office will then register the title in the name of the buyer.

Tips & Warnings

  • It is the seller's responsibility to ensure all land rates have been paid before the transfer of title is effected.
  • Avoid purchasing land that does not have an issued title e.g. where the seller only has an allotment letter. The potential for fraud is high in such cases.
  • Building permission may be required from the local authority. Check with the County lands office.
  • The land search fee is KES 500.

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