Investing in land in Kenya has come to symbolise a visible measure of financial success to most, and in some communities, it is even akin to a rite of passage.

Let’s explore if buroti maguta maguta, ka-mugunda, lives up to the hype as an investment option.

  • Land investment in Kenya has historically yielded high returns. With property prices consistently appreciating over time, investors can expect significant capital gains from their land purchase.
  • Land is often considered a hedge against inflation, as its value tends to appreciate over the long term, therefore keeping pace with or outpacing inflation rates.
  • Land is a tangible asset with intrinsic value that can be passed down through generations, serving as a legacy asset for investors, their families and future generations.
  • Land can yield other sources of income, such as the construction of rental properties, farming, or leasing the land out for farming and renting it out as space for use.

Overall, land offers a myriad of benefits, including capital appreciation, portfolio diversification, wealth preservation, and rental income.

However, it is not all rosy as there are downsides to investing in land.

  • Land fraud is on the rise in Kenya, with title deeds being issued to multiple buyers.
  • Land transactions are lengthy and complex, and therefore, money invested in land cannot be reclaimed for an urgent need.
  • Land investment in Kenya is speculative, and there is a risk that the area one gambles on may not develop or may take a long time to generate returns.

Before investing in land, it is prudent to understand the Kenyan law around land.

Land is classified into public, community, and private. In Kenya, citizens can own private land on leasehold (which gives absolute ownership) and freehold (ownership expires after a maximum of 99 years) tenure. Non-residents can only own land on leasehold tenure.

The first step in the land-buying process should be a physical visit to ascertain that the land exists. It is also a chance to engage the locals who can give you the backstory.

This should be followed by a title deed land search to confirm the real owners of the land, check if the title has been charged to a bank for a loan, whether it has a caveat, or if there are land rates due. A search costs KSh 500 and is paid via the Ardhisasa website or the e-Citizen platform.

Kenyans usually opt to outsource buying land to estate companies or buy land informally through social networks, but it is important to engage professionals for safety and peace of mind.

Valuers help value land for stamp duty. Surveyors assist in ground verification and processing land maps. The Land Control Board gives consent for land transfers. Advocates help draft sale agreements between the seller and the buyer of the land. At its most basic, a sales agreement should include a description of the land, price, method of payment, and mode of payment.

With national and county governments continuing to undertake infrastructural development and Kenya’s population projected to keep rising, investment in land is poised for further growth in the medium and long term.