Kiambu County is set to tighten regulation on property brokers weeks after it was reported as the only Nairobi neighbourhood to record a drop in quarter three prices of land.
The county said it will, in the next three months, register all brokers to mitigate against fraud it estimates at Sh3 billion annually.
The move targeting elimination of briefcase operatives comes after Hassconsult reported prices in the county—previously fast rising—had fallen particularly due to restriction on conversion of agricultural land to real estate.
Limuru sub-county was hardest hit with a 5.7 per cent fall.
Governor Ferdinand Waititu said this will make it possible for the devolved unit to rein in rogue dealers whose only agenda is fraud.
“We are going to register all of them. We want to be aware of your office, the deals you are in, whether those properties you are offering in the market are genuine. We will assume the role of final authority on their authenticity,” he said.
Mr Waititu noted that there was an increase of court cases touching on land fraud in Kiambu.
“Within three months, we will have registered all of them and feed the information on an e-platform. We will be demanding an updated list of properties they are placing in the market and before any transaction gets through, we will be giving the go-ahead,” Mr Waititu said.
Potential customers will have a customer care desk at the county where they will be registering the intended transactions with Kiambu property brokers.
“For a fee of Sh100, we will be executing searches for them and following it up with authenticating transaction documents. Land registries are devolved units and as a county government, we will bring sanity in this sector,” he said.
He said malpractices had threatened the local real estate sector for the past five years.
Stringent county policies cut town land prices in Kiambu
Land prices in Kiambu satellite towns have gone down significantly over the third quarter of this year mainly driven by investor caution following stringent administrative measures, with Limuru hardest hit.
Kiambu County, whose satellite towns have been stellar performers on both an annual and a quarterly basis, recorded drops in land prices attributed to the effect of an earlier proposal to control land use by the county government.
In June this year, Kiambu County under former governor William Kabogo announced a new plan backed by international partners to regulate land use to boost food security.
Many farmers have subdivided their land and either sold it to real estate developers or used it to invest in real estate themselves.
The continued loss of agricultural land to real estate prompted the Kiambu government to adopt spatial planning to ensure food security.
The seven Kiambu County satellite towns that recorded land price drops include Limuru which recorded the highest land price drop at 5.7 per cent, Juja at five per cent, Ruiru 3.5 per cent, Kiambu Town 1.8 per cent, Tigoni 1.7 per cent and Thika with the narrowest drop of 0.6 per cent.
The drops registered a spillover effect on the neighbouring Kitisuru and Ridgeways suburbs, which recorded a 1.9 per cent and 2.2 per cent drop respectively.
“Land for real estate commands a significantly higher price than land meant for agricultural use. Policies that prevent the change in land use from agriculture to real estate will therefore adversely affect land prices,” said Ms Sakina Hassanali, head of development consulting and research at HassConsult.
“Investors are therefore holding back on buying land in satellite towns in Kiambu County until they are certain that purchases will not be affected by the proposed policies on land use.”
On the contrary, Nairobi’s 18 suburbs recorded a 0.4 per cent increase in asking prices over the quarter.
Kilimani was the best performing area with prices up 2.5 per cent while Lavington witnessed a land price correction of 2.6 per cent over the same period.
“Land prices in Nairobi reported a marginal increase in asking prices despite uncertainty in the political environment which had a negative effect on property prices in the city’s suburbs,” said Ms Hassanali.
On an annual basis Langata was the best performing suburb with an 8.5 per cent increase in the asking price while Ridgeways was on the tail end with a 0.5 per cent drop.