Kenya Real Estate for beginners - Plots/Land

It’s never too early to buy a plot for your own future home or for investment purposes.

Do your due diligence

1. Check in your proposed location of purchase for amenities that you require

a. Electricity

b. Water

c. Nearness to tarmac road/main road or river if for farming

d. Any proposed developments

e. Any past or present issues with land ownership such as reserves, demolitions, forest land

f. talk to neighbours understand if any issues over land

g. confirm pricing either via Nation’s Thursday property guide or visiting nearby shopping centre

h. above all, visit the plot/land you intend to buy wherever possible.

2. Paperwork

Get the owner to show you the title deed. Note the title deed number and the size of plot/land. Note that 1 hectare 2.47 acres. ¼ acre is therefore 0.24 hectares. Note that some surveyors can and do understate acreage

Take a photocopy of the title deed and take the same to the local district land registry where you will pay Ksh500 for a search. The search is a land registry document that confirms if there are any caveats from bank, other buyers or relatives.

There are occasions when owner may legitimately not have a title deed. The only legitimate reason is inherited plot/land. Certificates are tricky because there is a trade off between legit certificates that can easily be converted to title deeds and certificates of ownership that are in perpetuity

It favours you often to have a sale agreement that has the legal back up. If you are buying plot/land worth Ksh1m plus, the lawyer costs can to around 30-40k. I think it is worth it.

You will need original and copies of your ID, KRA PIN (which you can no longer obtain without an ID). You will also need 4 passport photos from buyer and seller.

Don’t bribe to get paperwork processed faster. For example special land boards will usually come back to bite you. Most land offices have the terms of service prominently displayed on the counter and its worth reminding them.

vii. Copy of owner's title deed->search->sale agreement->transfer->land board consent->stamp duty->your title deed

Pricing: Kenyans today know the worth of their land. No seller will overprice you if you make them a reasonable offer. Cash is king and if you have it, it opens doors to very reasonable price offers. As an example, most people nowadays do 10% deposit and remainder in 3 months. If you go to the seller 10% now and remainder in a month provided they drop price, it leads to a different outcome. It’s also possible to go to the same seller and offer 50% now and remainder in 6 months and they’ll favour you because of the cashflow aspect of a deal. Pointing aspects that please you and those that don’t while pointing out favourable payment terms will get the price down too.

Related costs: Stamp duty on plot/land is 2% in rural areas and 4% in urban areas. That is % of buying price or Lands’ valuation whichever is higher. Where land requires surveyor beacons, you need to add another Ksh10k though you should get the seller to these on. The costs of changing the documents tend to be around 3-4k. If you get a sale agreement, you’ll find most sellers don’t really care either way and you bear the cost 100%. All in all, these related costs will be between 3-6%.

Caveats: There is caveat emptor. You also place a caveat with Land registry if you are putting down a deposit and paying remainder much later or you fear somebody may attempt to sell your plot/land especially if you are in diaspora.