Everyone wishes to buy a piece of property. It’s the most valuable fixed asset you could own right now. However, there are some key steps to follow if you want to acquire land anywhere in Kenya. The following are the legal steps to buying land in Kenya:
1. Searches and inspection of the title
It is always advised that once you have identified land, you go to the lands registry and do a search of the lot in question. To make the search easier, you’ll need a copy of the land title document from the seller.
After submitting a search application form, it usually takes about two hours to receive search results (and attaching a copy of the title). This procedure will set you back Sh500. The land’s data, including the registered owner, acreage, and any caveats listed against the title deed, are included in the search results.
2. Search at the County Office
This aids in the discovery of any unpaid land rates that should be accounted for in the purchase price. The cost of a certificate of clearance from Nairobi is Sh10,000, however it varies by county. Land rate payment is a legal requirement for all landowners, and they must settle any outstanding rates and penalties (if any) before selling their property.
3. Obtain Land Rent Clearance Certificate
The seller’s attorney will get a free land rent clearing certificate from the Commissioner of Lands’ office. This procedure can take up to 19 days to complete.
4. Obtain Maps of the Land
At a cost of Sh300 apiece, the maps can be obtained from the Ministry of Lands or a surveyor. One map is normally scaled, while the other offers a general overview of the area.
After receiving the maps, the buyer and surveyor should go to the property to double-check the proportions. After then, the buyer must build beacons in order to avoid future disagreements.
When buying land in Kenya, this symbolizes the end of a lengthy due diligence process.
5. Price Negotiations and Offers
When the buyer is satisfied that all aspects of the property are satisfactory, they will instruct their attorney to prepare a purchase offer.
The letter of offer should include the buyer’s and seller’s contact information, a detailed description of the property on offer, and the suggested purchase price and payment method.
6. Sale agreement and deposit payment
The sale agreement, which is produced by the seller’s lawyer, specifies the terms of sale, including the buyer’s and seller’s names, the price, the method of payment, and the documents that the seller must provide to assist the transfer of land to the buyer’s registration.
During the signing of the sale agreement, the buyer’s advocate should be present.
The seller may request a 10% deposit at this time, but it is best not to part with any money until the Land Control Board has given its approval.
7. Land Control Board Clearance
The LCB is a forum made up of local elders and county commissioners whose job it is to ensure that land transactions are done in a transparent manner, such as preventing a person from selling communal land without permission. This will set you back Sh1,000.
8. Transfer documents and consent to the transfer
The seller’s advocate prepares the land transfer forms, which are signed by both the buyer and the seller, after the deposit payment is made.
The buyer then goes to the National Land Commission (NLC) to apply for consent to transfer, armed with a booking form, LCB consent, land search, county rates clearance, land rent certificate, KRA pin, transfer instrument, sale agreement, and old title deed. The Commissioner of Lands would have previously granted consent. This procedure takes about nine days and costs Sh1,000. The draft transfer will then be initiated by the buyer’s advocate at the NLC office.
Before it is taken to the land office for stamp duty assessment, the seller’s advocate must approve the transfer document. This process costs Sh500 and takes four days.
9. Valuation and Payment of Stamp Duty
The buyer must use the valuation form filled out by the seller to request for a government valuation of the land.
These documents will be used by the lands office to calculate the stamp duty due. In three days, the valuer is scheduled to submit a valuation report.
The stamp duty is 4% of the land value in urban areas and 2% in rural regions, and it must be paid to the Commissioner of Domestic Taxes. The Kenya Revenue Authority takes four days to confirm payment receipt.
10. Registration of Transfer
After paying the stamp duty, the buyer must pay the remaining amount of the agreed-upon sum to complete the registration of the paperwork.
All of the stamped documents are now sent to the Lands office for registration. The consent transfer, land rent clearance certificate, rate clearance certificate, and the original title deed are among these documents.
This procedure can take up to 12 days to complete, following which the ownership of the property in question is declared lawfully transferred.