TAXES & REAL PROPERTY IN KENYA | Part 2: Land Transaction Costs

Land tenure is the name given, particularly in common law systems, to the legal regime in which land is owned by an individual, who is said to “hold” the land.

Over history, many different forms of land ownership, i.e., ways of owning land, have been established.  This Part of the Series shall concentrate on the costs incurred from Land Acquisition up to the time the Land Title is registered in the name of the Project/The Developer.

In a Joint Venture Agreement, I would like to note that a Company formed between the Land Owner and the Financier can carry the title of “The Developer”. Thus, i would like my readers to acknowledge this distinction. It is possible for the name of an apartment to be the same as that of The Developer especially in a Joint Venture Agreement.

1.1 Land acquisition

Stamp Duty – A tax levied on the value of the land transaction.

  • 4%- Within Municipality
  • 2%- Outside Municipality

1.2 Surveyors Fees

To clearly establish the boundaries before land is registered

  • 1.2.1 Option 1: Government Surveyor- Kshs.2,450.00 per plot
  • 1.2.2 Option 2: Private Registered Surveyor- Kshs. 15,000+ per plot

1.3 Conveyancing- Transferring land ownership from the seller to the buyer

1.3.1 Conveyancing Fees are levied at rate of Kshs. 1,250 per lease

1.4 Title Registration Costs

Registrative Cost is levied as a charge for the services offered by government in registering the land under new ownership/ processing fees

This is levied at Kshs. 250 per lease

Once The Developer has acquired the Land, it can proceed to the next phase of engaging Consultants to do the design, Documentation and Tendering.

The Other Parts of the Series are

Part 1 | An Overview

Part 3 | Consultancy Costs

Part 4 | Construction Costs/Taxes

Part 5 | Ownership Costs

Part 6 | Economic Impact of Taxes & Proposed Solutions



~ by ujenzibora on July 23, 2010.

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