The Basics of Purchasing Land in Kenya with AMMLAW. Part 2.
When it comes to land, we have all heard or experienced some horror stories where potential buyers have been conned or hoodwinked. These horror stories may be the reason you are skeptical about investing in real estate, but we’ve got some good news! If you or your legal partner of choice do your due diligence, investing in property could give you great returns.
We strongly recommend to each of our clients to do their due diligence while doing all their real estate transactions to avoid some of the common pitfalls. Due diligence in this respect means collecting all the necessary information regarding the prospective property and ensuring it is accurate and authentic. It also involves confirming who the true owner of the property is, the size, dimensions, and status of the property, for example, whether the property is free of any claims by anyone — this could be extended family or a financial institution.
You may wonder, how do I do my due diligence at every step?
To start with, evaluate your goals and clarify your purpose for property investment, then scout for land that meets this purpose with someone you trust. We recommend working with a legal partner that will advise you on the pros and cons for each purchase.
When you spot the property, you would like to purchase, ensure you physically meet the registered owner. Request for the original and certified copies of the property’s title deed, their National Identity card, company registration certificate (if the registered owner is a company) and Kenya Revenue Authority P.I.N. Certificate. If they only provide copies, ensure that they are certified copies.
If you have time, interact with the locals, and ask about the history of the land to understand if there are any claims, family feuds or social issues with the property you’re interested in. This information is valuable BEFORE you make a purchase.
Conduct a land search. You will need to fill in the search application form, a certified copy of the title deed, a copy of your ID, a copy of your KRA PIN Certificate and submit it to the relevant registrar of lands office. Once it is processed, the registry will issue you the search report, which should reveal:
- The current registered owner(s) of a property and the duration of their ownership.
- The current encumbrance(s) against the title deed, like bank loans, court judgements or “cautions” by any interested parties.
A green card search is possible for some properties. Such a search reveals a historical perspective of the property’s ownership, for example, point of last subdivision and change in ownership over the years.
If unable to conduct the land search yourself or need clarity on how you can safely purchase your next property, reach out to us at law@ammlaw.co.ke.