Introduction
Purchasing land in Kenya has been riddled with complexities that have made the process a daunting task for most Kenyans. The news media is replete with stories of how innocent Kenyans have been swindled and their hard earned money lost in scams perpetrated by unscrupulous individuals. This article will highlight eighteen (18) mistakes to avoid when purchasing land in Kenya.
1. Failing to conduct a search of the Property
This is a crucial step in the process of purchasing land in Kenya. The only way through which one can find out whether the land is in the name of the seller is by conducting an official search. This is a common mistake where people operate on blind trust and end up losing money in the land transaction.
2. Failing to conduct a site visit
The ownership of land is an emotive issue in the country and yet time and time again buyers opt to purchase land without carrying out a physical site visit. It is paramount for a buyer to visit the land before entering into the transaction. Further, a physical site visit is necessary to establish the environmental conditions surrounding the land such as the existence of an open site dump site near or on the land or other environmental factors which render the land undesirable.
3. Failure to involve an Advocate of the High Court of Kenya in the transaction
There is a growing trend in land transactions where most land buyers rely on the services of the seller’s advocate in the land transactions. Advocates acting on behalf of the seller are likely to skew the terms and conditions of the transaction to favour the seller. Consequently, it is imperative that you retain the services of an Advocate of the High Court of Kenya to represent you in the transaction.
4. Failure to pay stamp duty
The non –payment of stamp duty in a land transaction usually renders the land transaction voidable. Further, the instruments of transfer executed by the seller are not admissible in a court of law. Most buyers usually avoid paying stamp duty on the transaction to avoid the additional costs which eventually becomes their undoing.
5. Purchasing property in the name of a deceased person that is yet to undergo succession
Purchasing the property of a deceased person which has not undergone succession is usually not recommended as the same amount to intermeddling of the estate of the deceased. We have seen a growing trend of land buyers and sellers who opt to ignore the complex nature of the succession process and purchase the land in the name of the deceased person. The persons purporting to act in the name of the deceased person cannot pass a valid title to the buyer.
6. Failure to involve a valuer in the transaction
The failure to involve a valuer in the land transaction is usually an expensive error in the part of the buyer. Involving a valuer is crucial to ensure that you do not purchase a property which is way above the market value.
7. Purchasing the property without seeing a copy of the certificate of title
This is one of the most common errors that prospective land buyers make when purchasing a property. Buyers usually choose to operate on blind trust hoping that the seller will willingly hand over a copy of the title and complete the transaction once the purchase price is paid.
8. Failure to secure a spousal consent
There is a rebuttable presumption that properties in the name of the spouse is matrimonial property and as such it is held in trust for the other spouse. It is crucial for a buyer to secure a spousal consent before purchasing the property.
9. Purchasing property from brokers as opposed to the owners of the land
Prospective buyers of the property should avoid purchasing property from agents or brokers as opposed to the owners of the land. A broker or an agent has to show through a Power of Attorney that he or she has authority to enter into a transaction on behalf of the owner of the land.
10. Purchasing property from a real estate company that is not in the name of the real estate company.
Purchasing property from a real estate company when the property is not in the name of the real estate company has become a source of pain for many Kenyans. Unscrupulous individuals usually set up real estate companies to swindle Kenyans and then disappear leaving desperate Kenyans with little to no recourse.
11. Failure to determine the outstanding land rates and land rent
It is paramount for prospective buyers to carry out a search on the County Land Offices to determine whether there are any outstanding land rates or rent which is outstanding. We have seen a situation where sellers fail to disclose the outstanding rent and rates arrears only for the buyer to discover the outstanding arrears run into millions.
12. Failure to conduct a historical search of the property
The emerging jurisprudence from the Supreme Court of Kenya concerning the ownership of land, has made it necessary for a prospective buyer to investigate the root title of the parcel of land. A historical search is necessary to establish the validity of the title as well as the existence of any other competing interests in the land which might not be immediately obvious when you carry out an official search.
13. Paying the deposit without signing a sale agreement
One of the most common mistakes that prospective land buyers make in the process of purchasing land is paying the deposit without a sale agreement. The seller will usually inform the prospective buyer that they are experiencing some emergency which requires the payment of the deposit or the purchase price in a short period of time. The prospective seller might create a manufactured emergency which would need the buyer to pay the deposit or the purchase price without the sale agreement. The net effect of the rush to pay the deposit or the purchase price without a sale agreement is that an oral contract of the sale of land is unenforceable in a court of law.
14. Failure to confirm the National ID and the KRA Pin of the Seller
There is a growing trend of fraudsters impersonating the real owner of the property in order to swindle prospective buyers. These impersonators might even go to the extent of forging the ID and the KRA Pin of the real owner in order to carry out the con. It is therefore imperative to verify the ID and the KRA Pin of the prospective seller before purchasing the property.
15. Failure to ask the neighbours about the seller and the history of the land
With rising cases of land frauds, a buyer is now expected to carry out a social verification of the property by asking about the property from the adjacent owners. Neighbours will provide information which might not be captured in a land search such as the existence of competing claims to the land, whether the land has multiple title deeds and any other issues that might affect the decision to purchase the property.
16. Failure to obtain LCB Consent
One of the common mistakes that prospective buyers purchasing freehold properties make is the failure to obtain an LCB Consent. The prospective buyer will then find himself unable to complete the transaction or runs the risk of having the transaction declared void by a court of law.
17. Failure to carry out a boundary verification
It is paramount that a buyer hires the services of a surveyor who will establish the dimensions of the property on the ground. In some instances the acreage indicated on the certificate of title does not match the acreage indicated on the title. The failure to carry out boundary verification might lead the buyer to pay more for less or to be caught up in boundary disputes with adjacent property owners.
18. Failure to carry out a utility verification
It is paramount for a prospective buyer when purchasing a property to visit utility companies to establish whether there are any unpaid pending bills. Utility verification is paramount to ensure that the buyer does not incur unnecessary expenses incurred by the previous owner (s).
Conclusion
The list above is not exhaustive and does not cover all the mistakes a buyer should avoid when entering into a land transaction. It is important to retain the services of an Advocate of the High Court of Kenya to avoid the above mentioned mistakes and to avoid being conned.
This article is free of charge for information purposes only. It does not constitute legal advice and it should be not relied on as such. WNK Advocates LLP takes no responsibility for the accuracy and /or correctness of the information and commentary as set out in the article. If you have any query regarding the same, please contact us at legal@wnkadvocates.com.
