The Ten Key Steps To Buying Prime Plots in Kenya, Successfully

Land buying should be as easy as our 1, 2, 3’s but unfortunately, that may not be the case if you don’t know what to watch out for and what to consider when buying your prime plot.
We are all familiar with the Syokimau incident where many of us were shocked at the sight of pricy homes being flattened by bulldozers and the number of unexpected victims. Truth be told, Kenyans are often fleeced when investing in plots, and the emotional distress that comes with losing all your hard earned money may be one of the reasons we as Kenyans are skeptical every time we hear of a great real estate deal or a prime plot for sale.

Following the fundamental principles of the law of contract, buying or prime plots in Kenya may not be as easy as we may want it to be especially for first-time investors. For example, just like when purchasing any other item we have in our markets, the seller is not obligated to inform you as the buyer of any pitfalls or defects, e.g. flooding, of the piece of plot you have identified. This is the buyer beware principle. However, the seller is obligated to disclose any title deed defects (caveats) e.g. if the prime plot in question is acting as security against a bank loan.

Land in Kenya is normally identified using a Land Rate (LR) or Plot number. After you have identified the piece of land you wish to invest in and the LR number acquired from the seller, you proceed as follows to ensure you do not fall prey to a fraudster wanting to make quick and easy money from you.

1. Ministry of Lands Search:

Have a search conducted by the Ministry of Lands at the district or County headquarters. This search will reveal:

• The genuine owner of the piece of land

• Whether there are any brokers assigned to it

• If the title deed has a caveat e.g. as security on a bank loan or a court order barring any transactions on the plot for sale.

A valid search, which should be no more than six months old, will cost you Ksh. 520. This should be ready within two hours.

2. Local County Offices Search

A local county search will confirm any Land rates that have been unpaid. This will go a long way in deciding the purchase price of the plot. The cost of this search varies from county to county in Kenya for example, in Nairobi, you will be required to have a clearance certificate from the Nairobi County, which normally costs Ksh. 7,500 and should be ready for you within 2 hours.

You will need to have an agreement with the owner on who is to settle any outstanding land rates, if any since the plot cannot be transferred if land rates are not settled.

3. Land Map

You need to purchase a map of the prime plot for sale. Normally, we have two maps, one showing neighboring farms and the other drawn to scale. Each map should cost you about Ksh. 300 and you can buy them at the Ministry of Lands, but a local surveyor should be faster.

4. Ground Verification

One cardinal rule you should never forget is conducting due diligence. Equipped with the map, the seller, and the surveyor should pay a visit to the land on the ground. It is advisable to have a tape measure to confirm the dimensions from the map are drawn to scale. Ensure availability of the beacons and have the lost ones replaced. Surveyors may charge about Ksh. 1000 per beacon which should be paid by the seller of the plot since he still owns it but you may decide to cost share or pay for it yourself depending on what you see fit.
In some cases, however, especially in the rural areas of Kenya, the neighbors may be invited to raise any land boundaries’ disputes if any.

5. Agreement

It is required by the law of Kenya to have any land transactions in writing. It is not a must for a lawyer to be involved but very advisable.

As per the tariff provided by the Law Society of Kenya, a lawyer should charge Ksh. 3000 if the land costs Ksh. 1,000,000 or less and charge Ksh. 8000 if the land value is over Ksh. 1, 000, 00. The buyer and the seller normally cost share this 50:50.

At this point, to avoid any later complications, ensure the seller’s spouse is present, fully aware and agrees with the transaction, if possible, have the spouse agree to this in writing.

6. Post-Agreement Transactions

Whether paying in cash or installments as stated in your agreement, the seller will most probably demand some money at this point as a form of commitment.

Ensure that the title deed and any other legal documents are in the lawyer’s custody before making any payments. This is to avoid scenarios like the seller taking a bank loan and using the title deed as security in the middle of the transaction. Remember, you already carried out your search in Step 1 and found a clean bill of health, but the seller can apply for a loan if he keeps the title deed after this step.

7. Land Control Board (LCB)

LCB is a council that meets once a month comprising of the Assistant County Commissioner and the local village elders that give the final consent on land sales.

I know, you think we are too modern to go through village elders, but, consider a case where Charles is selling a prime plot without informing his wife yet they have no other place to go. The LCB will be forced to deny you consent knowing fully well that you made your initial payments at Step 6. This would only mean that you will have no choice but to ask for a refund. If lucky, you may get it immediately. However, the seller can easily be have spent the money already which would mean, you have to wait for a refund for a long time or choose to go to court, that may be years of back and forth.

If possible, get the spouse to agree to the sale of the property in writing just in case it was a plan to make money from you by later on going to the LCB and lodging a complaint to ensure the refusal by LCB.
The LCB should cost you Ksh. 1000. Nonetheless, there is a Special Land Control Board (SLCB) that consists of only the Assistant County Commissioner, the buyer, and the seller which will cost you Ksh. 5000 instead of waiting for the LCB, which only meets once a month. Depending on the availability of the Assistant County Commissioner, it may take you about 2 hours.
8. Land Transfer

Once the seller signs a Land Transfer form, after all, the payments have been settled, you can go ahead and start processing a new title deed to change ownership at the Ministry of Lands. You will need:
• Land transfer forms
• Consent from LCB or SLCB
• Land Search clearance form from the county council
• Passport photos
• KRA pin
• Agreement
• Old Title Deed

This will cost you roughly Ksh. 5000 and may take two weeks.

It is advisable to have the seller sign the Land Transfer documents in advance and hand them to the lawyer when making the initial payments to ensure the seller does not retract the agreement.

9. Transfer Fees and Stamp Duty.

At this point, you no longer need the seller, but you will need to pay stamp duty based on the value of the prime plot you have paid for, usually 2% for reserves and 4% for municipalities.

The land value may differ from the purchase price and in rare cases like these, the Ministry of Land official will demand a valuation, but usually, the purchase price is used.

10. Post Purchase Celebration

This is the point where you are allowed to invite your family and friends over for a celebration, maybe enjoy some nyama choma, ugali, kachumbari and drinks as you give yourself a pat on the back for going through all the steps, successfully, without letting any con man or woman make away with your money.

One last search at the Ministry of Lands to confirm that the LR Number now holds your details would not hurt.

Point to Note: The rates indicated in this article may change from time to time and should be confirmed with the relevant offices.