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What to consider when buying an apartment in Kenya

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​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​published on 3 March 2024 | reading time approx. 3 minutes

Apartments have been around for a very long time. The origin of the concept of apartments can be traced to even before the Neolithic era. The need for apartments was registered in urban and capital centres where the ruling and upper-class people resided. Apartments were built in areas close to power, business and social amenities.


Today, the need for apartments has become more apparent. This need has been amplified by the rural to urban migration driven by diverse factors. This need has prompted a radical and dynamic change in the legal framework to make the process of acquiring an apartment seamless and to protect the purchasers.
It is in this regard that we wish to highlight the fundamental considerations to bear in mind when purchasing an apartment in Kenya. These are:

Due Diligence

Conducting due diligence informs a purchaser the lawful owner of the apartment. This enables a party to contract with the right person. The due diligence also informs a purchaser the accurate property dimensions of the apartment. It also brings to your knowledge any existing encumbrances that may affect the sale.
Due diligence also informs the purchaser on the tenure being purchased. Tenure relates to the interest being purchased. The tenure can either be leasehold or absolute. The different tenures will trigger different legal procedures and documents before, during and after the sale.

It is imperative that a purchaser ensures that the government has (or had) approved the development of the apartments, the approved design as well as the erection of the apartment block on the property. This is done at the due diligence stage.

This assists a purchaser in avoiding purchasing an apartment unit that has been erected on a restricted area such as in a designated flight path, security area or riparian land. This stage is very important as it protects the purchaser from future lawsuits and possible demolition. 

The due diligence needs to be done thoroughly. We recommend the use of an experienced professional who can discern any irregularities and advise accordingly.

Ready purchase or off-plan purchase

Ready purchase means that the property is ready for occupancy. Off-plan purchase means that the purchase is for an apartment unit that is still under construction. In off-plan purchase, the purchase price is normally utilized to fund the construction of the apartments.

There are different aspects to consider in either of this purchase. Of particular interest is the defect liability period which requires the seller to repair any defects within a certain period of time. Normally, in a fresh apartment purchase, the buyer gets the benefit of this clause. The same benefit is also bestowed upon the off-plan purchaser. For a subsequent owner, the defect liability period may be agreed upon by the parties.
In so far as the off-plan purchase is concerned, it is important to define terms regulating failure to complete the construction as well as when the contractor can use the apartments being constructed as collateral to secure financing.

Community rules

It is important to familiarize oneself with the prevailing and/or proposed community rules. This will relate to the use of the common areas, potential areas of conflict and the conflict resolution mechanisms. 
It is also important to establish whether the community rules allow pets.

Future development and advancements

It is noteworthy to appreciate any upcoming developments with the area and/or inside the apartment block. This will enable you to manage your future expectations and particularly in relation to capital injections required from the purchaser in future. This consideration will also enable you assess the property value appreciation against the perceived developments and advancements.

Financing

If you are purchasing the property through financing, it is important to also understand the influence the financier will have in your enjoyment of the property. For instance, under the Sectional Properties Act, the participation in the management of the property will be reserved for the financier until you clear the mortgage.
 

Conclusion

The above information is for general knowledge purposes only. It is not a legal advisory. We invite you to engage a legal professional to assist you with the necessary due diligence and to hold your hand during the transaction.​

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Arthur Wamae

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​​​​Rödl & Partner in Kenya​

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