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Conducting Due Diligence When Buying Land in Kenya

A quick checklist of things to do before purchasing land.

Updated on

September 1, 2020

Be careful when dealing with land brokers. PHOTO/CK

Anyone planning to buy land in Kenya or anywhere else in the world should conduct thorough due diligence to avoid losing their hard-earned money to real estate fraudsters.

Due diligence when buying land usually involves verifying the ownership details of land, uncovering possible caveats, and putting in order the paperwork for the transaction.

Below is a due diligence checklist before buying land in Kenya:

1.) Land identification

Fraudsters often target individuals scouting for land. They guide them down the wrong path until they part with money. To avoid such incidents, be on high alert and ask as many questions as possible.

Ask for ownership proof since anybody can pretend to be selling a property they do not own. Be extra careful if the asking price is lower than the general pricing of land in the neighbourhood.

It is advisable to make a site visit without the seller so that you can talk with the neighbours to establish the history of the land. This can help you uncover any issues that the seller is unwilling to disclose to you.

You should consider taking the help of a surveyor to confirm that the measurements of the land and its boundaries are accurate to avoid paying the full amount for a fraction of the acreage.

2.) Search at lands office

After identifying a parcel of land that meets your desired criteria, ask the seller to give you a copy of the land title deed to facilitate the search.

It takes Sh250 and about two hours to obtain search results after completing a search application form – and attaching a copy of the title deed.

Search results will reveal the changes of ownership through deeds as well as the legal dues for the land proposed for acquisition.

The land search will also disclose whether or not the property has any incumbency or is attached to a commercial bank. It will also help you uncover any land disputes or caveats.

The search also helps to reveal any unpaid land rates that should be factored into the purchase price. A certificate of clearance from City Hall will cost you Sh7,500, but the fee varies in other counties.

A land search certificate remains valid for up to six months.

It is advisable to ask the land officials to give you a certified copy of the Green Card to confirm that the information on the land search certificate is accurate.

This will enable you to uncover any inconsistencies in the land search documents in case of a collusion between the seller and an official at the land’s office.

3.) Land Control Board clearance

The board consists of area elders and county officials and it has to ensure that land deals are done in a transparent manner – e.g. stopping a husband from selling family land without the wife’s consent.

This costs Sh1,000. However, instead of waiting for the main LCB meeting, the parties can schedule a special meeting involving only the assistant county commissioner at a cost of Sh5,000.

4.) Legal representation

There are legal procedures to be followed when buying land in Kenya. It is therefore important to hire a lawyer who specialises in property transactions to guide you through the transaction procedures.

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The lawyer may assist you in obtaining clearance documents such as land rates clearance from the county and land rent clearance from the Ministry of Lands.

These documents are so important that failure to present them may lead to a court order that is against this deal being revoked.

5.) Closing the deal

Once you are satisfied with all the details of the land, your lawyer should guide you on how to close the deal. Ordinarily, you are required to pay a deposit of 10% of the purchase price to sign the deal.

This is the recommended value for a legal sale agreement to be recognized in Kenya. Paying more than 10% is not advisable because it increases your risk in case of any undesirable outcomes going forward.

6.) Buying from a company

Due diligence when buying land from a business, land-buying company, or Sacco requires you to obtain the registration certificate of the entity to confirm its legal existence.

Ask for the KRA pin certificate to verify the legitimacy of the company and its directors. This information can help you determine whether the company or its directors have been involved in a land fraud case.

Also ask for the original copy of the title deed and a certified copy of the land documents from the business, land-buying company or Sacco to confirm that all the details are truthful.