Property Buyers Be Aware

26/03/2020

How to conduct online land search

1.Log onto the e-Citizen portal and sign up (if already registered sign in)

2.Click on Ministry of Land, Housing & Urban Development link and choose Land Search

3.Enter the title number e.g. Nairobi/Block123/321. Fill the online form and submit.

4.Confirm details and proceed to pay using the available payment methods which include mpesa, debit cards, credit cards or bank transfers.

5.Once the payment has been confirmed, the applicant can then proceed to print the results. However, if you decide not to print the results will still be available online in your e-Citizen account.

25/03/2020

13/01/2020

HOW TO GET A TITLE DEED

The Land Act, 2012 under Section 7 outlines seven ways one can use to acquire a title. They are as follows:

Allocation: This is where public land is transferred by the government to individuals usually for a specified time and for a specific use with stated conditions. Allocation can be through a public auction, tender, drawing of lots or balloting or by confining allocation to a disadvantaged group. For land to be allocated, it must first be planned, surveyed and serviced.
Land adjudication: This is when rights and interests to land are ascertained and recorded in areas of community land (formally known as the trust land areas).
Compulsory acquisition: This is the acquisition of land by the government for a public purpose but subject to fair and prompt compensation. Publication of the intention to acquire is done through the Kenya Gazette and County Gazette.
Prescription: This is also known as adverse possession and occurs when one gains title to real property through occupation of land without opposition for 12 years. It involves a court process and the adverse possessor must prove that she actually occupied the land continuously without interruption for the above specified time.
Settlement programmes: This is when the government provides access to land for squatters, persons displaced by natural courses like floods, development projects, conservation or internal conflicts by use of the Land Settlement Fund administered by the National Land Commission. Formerly it was known as Settlement Fund Trustees.
Transmissions: This is when ownership passes to another party whose powers over the land are restricted as in cases of death, bankruptcy and on liquidation of a company. In case of death, a personal representative will be registered as the proprietor of the land, for bankruptcy a trustee becomes the registered proprietor while a liquidator shall be registered as the proprietor in cases of liquidation of companies, all by order of the court.
Transfers: This is the transfer of rights to land through sale. A transfer is done after acquiring consent from the relevant County Land Management Boards in (all 47 counties). Stamp duty of 2 per cent.

20/11/2019

Buying property in Kenya

November , 2019

Buying Process

The purchaser begins with identifying a suitable property for purchase. One needs to enlist the services of a reputable real estate agency/firm to assist in identifying a suitable property.

The buyer then should endeavour to visit the site and satisfy themselves that it meets the desired criteria including its physical location and boundaries, and thereafter make a formal offer or expression of interest.

After an offer has been accepted, buyers should conduct due diligence to verify the ownership and other material aspects pertaining to the property and documentation etc.

The vendor also conducts due diligence on the buyer. If the due diligence process is successful, both parties then instruct their advocates to proceed to the contract stage.

The procedure may vary slightly depending on whether one is buying a completed property (ready for occupation), land or an off-plan property.

In the former, after paying the deposit, the transaction is completed within a defined closure period, normally 90 days from date of signing the sale agreement (although parties can mutually agree on any closure period that suits them). In the latter, after paying the requisite deposit, buyers normally pay a percentage of the purchase price in equal instalments until the project is completed.

Nairobi
Sale Agreement

Once the sale agreement is signed by both parties, the deal becomes legally binding and enforceable under the law of contract. The buyer is required to pay a deposit of at least 10% of the purchase price (or such other amount as may be agreed by both parties) upon signing the sale agreement.

The deposit is held by the seller’s advocates as stakeholders pending completion of the transaction in accordance with the terms of the sale agreement.

Alternatively, the buyer and seller can mutually agree to open a joint escrow account mandating both advocates to oversee the purchase funds until completion of the sale.

Buyers will normally then forfeit a percentage, or all, of the deposit if they default or are refunded the said deposit if the seller is unable to complete the transaction. It is important that every instrument effecting a disposition in land is executed by each of the partiesconsenting to it.

Ex*****on under the relevant Kenyan law consists of the person appending his/ her signature or affixing his/ her thumbprint or other mark as evidence of personal acceptance of the instrument. Ex*****on by a corporate body, association or any other organisation should be done in the presence of an Advocate of the High Court of Kenya, a magistrate, a judge or a notary public.

Completion

On the completion date, buyers are required to pay the full balance of the purchase price in exchange for the completion documents from the seller.

Once the buyer’s advocates are in receipt of the completion documents, they make arrangements for the property to be assessed for Stamp Duty by a Government Valuer and subsequently stamping of transfer documents. Thereafter, they proceed to lodge the property for registration in favour of the buyer.

After the registration process, the seller’s advocate is legally permitted to release the full proceeds of the sale to the seller.

Consequently, the buyer is officially handed over possession of the property and becomes the new legal owner.

The certificate of title issued by the Registrar upon registration, or to a purchaser of land upon a Transfer by the seller is taken by all courts as prima facie (at first appearance) evidence that the person named as the proprietor of the land is the absolute and indefeasible owner.

It is also possible to purchase land in Kenya without being in the country. One can assign a lawyer to go through the whole process on their behalf through the power of attorney.

Property Transactional

Costs

Buyers will incur certain transactional costs when buying either residential or commercial property in Kenya.

Buying Residential Property

Stamp Duty/Land Tax: This levy is centred on the property value and the State relies on the amount returned by the Government Valuer or the purchase price agreed upon; whichever is higher:

• 4% for land/property within a municipality

• 2% for agricultural land or property outside a municipality

• 1% if a property is registered as a company and transfer is by way of shares rather than title

Legal fees: Each party pays for their own legal fees based on a percentage of the purchase price on a scale stipulated in the Advocates Remuneration v Amendment Order, 2014. Thevonly exception which appears to be a common practice, is where buyers are required to pay legal fees for both parties when buying an apartment.

The argument for this is based on the fact that the seller’s lawyer is the one who does registration for all the leases onvbehalf of the buyer.

Agency fees: The agent is paid by the party who instructs them either by the seller who instructs the agent to market the property or the buyer who instructs the agent for a property acquisition. The fee is on a scale capped at a maximum of 3% of the property’s value.

Registration and disbursement fees: Buyers are generally responsible for the cost of registration of titles in their name(s) together with other disbursement costs as may be advised by the seller’s advocate.

Foreigners’ Purchasing Regulations

Just like Kenyan citizens, foreigners are permitted to buy commercial and residential properties/land located within a town or municipality without any restrictions whatsoever, provided that they comply with the laid down procedures. The only restrictions are on owning agricultural land, freehold titles and first row beach plots along the Kenyan Coast.

Article 65 of the Kenyan Constitution limits foreigners to holding only leasehold titles for a maximum of 99 years but permits future renewals on condition that the subject property held under that title is economically active and it is not required for public use purposes. This therefore means that if a foreigner purchases a property held under a freehold title, it will revert to a long term leasehold tenure.

The restriction also applies to companies that are not wholly owned by citizens or property held in trust whose beneficiary is not a citizen.

This note is meant to give a very basic indication of the purchasing process and no liability is assumed as each interested person should seek local professional advice.

05/07/2018

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20/02/2018

Steps of buying land in Kenya

If you are buying land from an individual or a group, follow the following steps:

1. Ask to see the title deed or copy of title deed. Then do a search at the ministry of lands to confirm who the real owners are or if the title has any Caveat on it. The search will cost you kshs 520.

2. Do a search with the local authorities to check of any unpaid land rates. If any, agree with the seller on who will settle the debt. Nb: land can't be transferred if there are unpaid land rates.

3. Go to the ministry of lands and buy 2 maps, one showing the exact measurements of the piece u are buying (called mutation) and the other showing the neighbouring lands. Each costs Ksh 350.

4. With your 2 maps and a surveyor (you can even do it yourself) , visit the land you are buying and verify the details on the map. Check out all the beacons.

5. Sit down with ua seller and bargain the price. Write down an agreement. The agreement can be done before a lawyer or yu may decide to do it yourself. It's not a must to be written by a lawyer. According to LSK, if the value of the land is below 1 million, you pay the lawyer 3k. If above 1m, yu pay 8k for the agreement.
The spouse MUST BE present! Ask me why the spouse must be present.

6. Pay some amounts or as per your agreement. Don't pay everything, hata k**a unazo pesa.

7. Book a meeting with the lands control board(LCB). They meet once a month. It will cost you kshs 1,000. But there is a special LCB meeting which yu can book at 5k. LCB will issue consent for the land to be sold.

8. Pay the remaining balance after getting consent from LCB.

9. With the consent from LCB, a recent search(not more than 6 months), clearance form from County land rates, your 2 maps, the agreement, KRA PIN, 2 Passports and copy of the title deed, go to the ministry of lands to change ownership. Cost kshs 5000.

10. At this stage, you no longer need the seller. Now go and pay stamp duty ie according to the value of the land.
4% of sale value in municipalities
2% " " " in reserves

11. Now the land belongs to you. But before celebrating, go to the ministry and do a search to confirm if it really reads your name.

07/02/2018

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27/11/2017

Land buying follows the basic principles of law of contract. The seller is supposed to disclose any defects on the title, e.g. if it’s being used as a security against a bank loan. Land buying requires that all legal and contractual procedures are followed to avoid future conflicts, which may lead to double loss.