Developers of apartments and sectional properties have up to December to comply with a new law that allows buyers of such assets to acquire individual ownership documents.
The Sectional Properties Act, whose regulations were passed by Parliament in December, comes with multiple changes, including allowing Kenyans who purchased single units in apartment blocks to get legal ownership papers, popularly known as title deeds. Previously, there was no law enabling this.
The new law also means that owners of such properties can use the documents for financial transactions, such as placing them as security for loans—a motivation for banks and financiers to offer credit facilities to the individual unit owners as they may now charge the individual units directly without requiring the consent of the developer and or the manager.
Further, the new law has reduced the leasehold period to 21 years from the 45 required under the repealed law.
Lands Cabinet Secretary Farida Karoney said property developers and professionals, including surveyors and lawyers, have until December to comply.
“Because of the short period, we have agreed that for any new development of apartments and sectional units, you must comply with the Sectional Properties Act.
“For developments that are finished but some of the units have been registered under long-term leases, we are allowing you to finish registration of the rest of the units under the old regime and then you can convert later,” Ms Karoney told Sunday Nation in an interview.
The CS said that for properties that have been registered under the old regime, the ministry would allow transactions to be performed on them until December as their owners' transition to the new law.
“If you want to charge your apartment and you have not converted to the SPA, 2020, we can allow you to do that with consultation with the chief land registrar based on whatever transaction you want to do. However, the moratorium ends in December because we all need to convert to the Sectional Properties Act, 2020 by December 2022.”
The state in February piloted the issuance of ownership papers for sectional properties, with the Lands ministry indicating that about 10,000 sectional title deeds would be issued in Nairobi.
“We have started with structured buildings like the NSSF-owned properties in Nyayo Embakasi. We want to start with the apartments that are easy to do to see how it plays out in the system. So far, we have had 10 successful transactions,” Ms Karoney said in March.
The new law further provides that all long-term sub-leases intended to confer ownership on a maisonette, apartment, flat, townhouse, or office that were registered before the new law shall be reviewed to conform to Section 54(5) of the Land Registration Act, a provision that helps to transition all buildings to sectional status and guarantees the absolute rights of the owners of such units to deal with the same without being subject to the power and direction of the developer and or the management firm.
The ministry met members of the Law Society of Kenya and the Institute of Surveyors of Kenya on Tuesday to address transitional issues that have faced owners and professionals dealing with sectional properties.
“A joint team representing the ISK, LSK, and the ministry will be formed to further discuss technical issues relating to long-term leases,” a joint communiqué by the ministry and the two bodies stated.
