Fact Checks Before Buying Land
Before Buying Land
Land is a long-term investment venture that has several benefits such as being a financial security (borrowing money), the property does not depreciate thus has high resale value, land is income generating through agricultural use, development (commercial buildings for rent), leasing etc.
Despite all the benefits afore mentioned, there are several things one needs to put into consideration before acquiring land as it is procedural and thus patience needs to be exercised.
>> 1. It is advised that one is certain about the use of the land, your budget, and most importantly the location of the property.
>> 2. Once the location has been established, it is prudent to know the zone in which the land lies e.g forest land, riparian reserves, flight path, government land, county land, agricultural, residential, or commercial land, leasehold land (rates and rent apply aid to the government across the number of years issued e.g. 99, 200, 999 years) or free-hold etc. This helps you to make a sound decision plus the company or individual you are dealing with is dutifully required to disclose this information to you.
>> 3. The next step for you is to find out whether the land is free of encumbrances i.e., Caveat Emptor, squabbles, bank charges, leased land (rented for a certain period of time, court cases etc. without full disclosure to you by the seller, these setbacks can be quite daunting in land acquisition and to say the least, land you in quite a mess.
>>4. Another important aspect is to verify the value of the land, and this is done by a professional government valuer. This may be done if one feels the set price by the seller may not give them return on investment. Value is given to a property through the surrounding amenities (how much the area has developed), its potential for income generation and high value return on resale, cost of land preparation and maintenance (beacons, subdivision, fencing etc.)
>>5. Once the target has been set, it is important that a site visit be made to physically acknowledge the land and to also meet with the owners of the land i.e., directors, if it is a company, or an independent seller. At this stage, one is advised to request for copies of documentation such as National ID and KRA PIN Certificate of the seller or National ID (s) KRA PIN certificates, and CR12 company registration certificate if it’s a company. A legitimate seller will not hesitate to produce these documents.
>>6. Next, get a copy of the title and have your lawyer perform a title search. This process will be beneficial in divulging the true owners of the land/property or directors, if it’s a company, whether the land has encumbrances, the history of the property, the actual property size and so on.
>>7. Always ensure the authenticity of all documents by visiting Land Control Board offices in that area and request to go through minutes of the meetings held, court proceedings and progress reports (if the parties had to seek legal redress due to family feuds, successorship, etc.) Also, visit Law Society portals to authenticate the lawyers involved in the cases and KRA portal to authenticate the PIN certificates of the sellers.
>>8. Once everything checks out, proceed with the purchase by signing a legal and binding sale agreement prepared by the company’s lawyer and your lawyer to paying for the land as agreed upon in the agreement and documents should be in triplicate.
>>9. On the successful purchase of the property, one is required to do a title transfer from the mother title to a title deed with one’s own name. This can be done by the company lawyer or one’s own lawyer at a fee.
>>10. Once the transfer of title is done, the land is no longer in the seller’s hands but your own and you may access it and use as planned whether leasehold or free hold.