Looking forward to buying land in Kenya? Acquiring a piece of land is a significant aspiration for many individuals, as it represents a highly valuable and enduring asset. However, when embarking on the journey of purchasing land in Kenya, it is essential to adhere to specific legal procedures. Here, we outline the crucial steps involved in the lawful acquisition of land in Kenya:
Step 1: Title Searches and Inspection
Upon identifying a desired parcel of land, it is advisable to visit the lands registry to conduct a thorough search of the property in question. To facilitate the search, the buyer should obtain a copy of the land title deed from the seller. This process typically takes approximately three days and involves ascertaining the rightful owner of the land and identifying any encumbrances or cautions associated with it.
In order to initiate a land search, individuals are required to complete a search application form and attach a copy of the title deed. The completed application, along with the necessary search fees (currently set at KShs. 500/-), must be submitted to the appropriate registry. It typically takes 2-3 days to obtain the search results from the Lands registry. The search results provide crucial information, including:
(i) The registered owner of the property.
(ii) The size of the land.
(iii) Any registered encumbrances such as prohibitions, court orders, cautions, and caveats.
Once the search results are obtained and deemed satisfactory, it is advisable to verify whether the land in question is listed in the Ndung’u Land Report, also known as the Report by the Commission of Inquiry on the Illegal and Irregularly Allocated Land.
Furthermore, it is prudent for the landowner to engage the services of a registered surveyor. The surveyor can verify the beacons on the land and perform preliminary checks at the Survey Department to gather additional relevant information.
Conducting a comprehensive land search, accompanied by the assistance of a registered surveyor, ensures a thorough understanding of the property’s ownership status and potential legal issues.
Step 2: Preparation of Offers and Price Negotiation
Once the buyer is content with the search results presented by their legal representatives from the lands registry and the company registry, they can proceed to authorize their advocate to prepare an offer. The buyer’s advocate should draft a letter of offer or intent, specifying the details of the seller and purchaser, a comprehensive description of the property, the proposed purchase price, and the agreed-upon modes of payment. Negotiations regarding the purchase price may also take place during this stage.
Step 3: Sale Agreement and Deposit Payment
To formalize the agreement between the buyer and seller, it is crucial to incorporate the terms and conditions into a legally binding sale agreement. Typically, the seller’s advocate drafts the agreement, which is then reviewed and approved by the buyer’s advocate. Once the sales agreement is executed, the purchaser pays the agreed-upon deposit through their advocate to the seller’s advocate’s designated account.
Step 4: Payment of Land Rates
Prospective buyers should be aware of any outstanding land rates associated with the property. It is the legal obligation of the landowner to settle these rates. Therefore, before concluding the transaction, the seller must ensure that all land rates have been paid to avoid complications. This step is particularly important to prevent any encumbrances imposed by authorities such as the City Council of Nairobi.
Step 5: Transfer Documents and Consent to Transfer
The seller’s advocate prepares the necessary transfer documents, which are then signed by both the buyer and the seller. However, before the transfer documents can be executed, the commissioner of lands must issue consent to transfer, verifying the legitimacy of the transaction.
Step 6: Valuation
To determine the appropriate stamp duty payable for the transaction, an application for valuation must be submitted to the government valuer. The government valuer conducts a site visit to assess the property’s true value on the open market, preparing a valuation report accordingly. The valuation serves as the basis for calculating the stamp duty required for property registration.
Step 7: Payment of Stamp Duty
The buyer bears the responsibility of paying the applicable stamp duty, a tax levied on all land transactions. The amount of stamp duty payable is determined by the government valuer and is crucial for the successful registration of the property.
Step 8: Registration of Transfer
Upon completion of the registration process, the legal ownership of the land officially transfers to the buyer, signifying a change in ownership rights.
Step 9: Exchange of Documents
Once the seller provides the buyer with the complete set of documents, the buyer is obligated to finalize the registration process by paying the outstanding balance to the seller through their respective legal representatives. This payment, inclusive of the requisite stamp duty, marks the conclusion of the transaction and enables the registration of the documents.
Acquiring land in Kenya necessitates a thorough adherence to these legal steps, ensuring a secure and legitimate transfer of ownership.
