Let’s say Anne bought land when she was 27. She had a good job, and some savings and wanted to invest in real estate.
She talked to an investment consultant who told her land never depreciates, so it is a good investment.
She bought a piece of land in a remote location, hoping to eventually reap big from it when it gained value and attracted development.
Along the way, however, Anne got distracted by everyday life. She went abroad to further her studies, returned, changed jobs, got promoted and was tasked with bigger roles at work.
At 47, her children do not need her as much as they did when they were toddlers and there is new talent at the workplace - tech-savvy youngsters who can do her job faster, at a lower cost.
The value has skyrocketed and the odds look good, but when she visits the plot, she finds a permanent house and a family living there, happily.
They even have a kitchen garden and they do not notice her staring in shock from the other side of the fence.
Land near satellite towns, which was primarily agricultural, is also being commercialised at a very fast rate.
Photo credit: Shutterstock
Ingredients of adverse possession
Such is a simple case of adverse possession, sometimes referred to as squatters’ rights.
Adverse Possession laws are common around the world. In Kenya, it is covered under the Limitation of Action Act. The Act reads:
“An action may not be brought by any person to recover the land after the end of 12 years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person.”
In simple terms, it means you cannot try to recover your land if you have abandoned and neglected it for more than 12 years, therefore allowing another person to occupy it uninterrupted for those 12 years.
The law allows squatters to apply for transfer of ownership if they have occupied a piece of land for the requisite 12 years and they fulfil all the requirements of adverse possession.
Such requirements include uninterrupted, open (not secret) and peaceful occupation without the permission of the land owner, with every intention to own the land.
For instance, building a permanent structure and planting trees could be perceived as a demonstration of one’s intention to own the land.
During the application for ownership, or court hearings (in the case where the initial owner defends their ownership), the adverse possessor is burdened with showing proof of the date they began occupying the land, the nature of their possession (could be living, farming, renting out as an owner), whether the owner was aware of their presence on the property and the cumulative period of their occupation.
The requisite 12 years begin to count from when the adverse possessor takes occupation. It is not inclusive of the years the land has been vacant or neglected.
If you are a land owner, you are probably thinking this will never happen to you, but it is more common than most imagine, and the risk is getting higher as populations increase, causing desperation among the landless.
People in diaspora most vulnerable
David Mbatia, a Financial Planning Specialist specialising in real estate, says the way many perceive and invest in land puts them at risk of losing it through adverse possession.
To understand the increasing risk of adverse possession, Mbatia breaks down land owners into several categories.
David Mbatia, a Financial Planning Specialist specialising in real estate, says the way many perceive and invest in land puts them at risk of losing it through adverse possession.
Photo credit: Pool
Among the rural population, for instance, the land is part of economic livelihoods. They till the land and feed their animals to generate household income, and as populations in rural areas grow, there is a lot of pressure to subdivide land, yet smaller units are less productive.
Land near satellite towns, which was primarily agricultural, is also being commercialised at a very fast rate.
With the increasing appetite for land by speculators, land-selling companies are advancing into rural towns. As a result, the rural population is pressured to sell, losing their livelihood while risking landlessness.
There is also the urban middle class which includes people in the diaspora, who form a big percentage of real estate investors.
They have the broadest access to financing but most have been socialised to acquire land as a form of savings.
They acquire land hoping that there will be capital gains without a clear development objective. Most acquisitions are speculative.
Often, they end up realising that their investments are not working for them. In effect, there are large tracts of land lying idle waiting for development that may never take place.
“We tend to view land ownership as a privilege, but in my view, many land owners are unaware of the responsibilities that come with land. Only a small percentage of the population is engaged and informed on how to scale the use of land and earn from it,” says Mbatia
Unfortunately, time passes very fast, and 12 years can accrue in the blink of an eye.
As such, certain categories of landowners are more prone to losing property through adverse possession, absent landowners, especially those working and living in the diaspora are at the top of this list.
“I offer independent oversight over property belonging to people in diaspora and I have noticed they are more vulnerable because of their absentia. It is very easy for people known or unknown to them to take advantage of their absence and occupy their land,” he says.
Land speculators are also very exposed. They hope to resell one day and do not necessarily pay attention to the land unless the value skyrockets unexpectedly.
Even worse, some buy before seeing the actual land because they believe they are buying from reputable property companies, and therefore cannot locate the property, the only evidence of ownership is the title deed.
As a result, they do not take any measures to protect their properties from squatters, such as fencing.
Such negligent speculators are likely to lose land to squatters in the long run. Lastly, affluent people who buy massive properties all over the country are also vulnerable, especially to their labourers who work without formal contracts or documentation.
Though squatting is often motivated by poverty and landlessness, anyone can be a squatter, including people who take advantage of the adverse possession law. In a location where there are many smallholder landowners juxtaposed against affluent owners with very large chunks of land, squatting is likely to take place as people try to advance themselves economically.
Mbatia notes that squatters often masquerade as labourers or caretakers of the land. Over time, the caretaker may begin to make decisions that only the owner should.
They may look for utility connections, bury their dead on the land, pay for land rates and keep records. If the property owner did not keep records of employment, then they may be unable to prove that the squatter was a worker.
It is also becoming increasingly common for proxies of family members to claim property on account of adverse possession.
For instance, if the land owner works abroad, his relatives living in the country might decide to lease his land or rent it out - 12 years later, those living within that property will have fulfilled many of the requirements for adverse possession.
Why this law is necessary
As unfair as adverse possession seems to land owners, it is purposefully implemented to ensure people keep land productive. Idle land does not contribute to the economy in any way.
As unfair as adverse possession seems to land owners, it is purposefully implemented to ensure people keep land productive. Idle land does not contribute to the economy in any way.
Photo credit: Shutterstock
“Adverse Possession law is necessary because the purpose is to reward those who use land productively. If you have a factory with machines that are not producing, it is a waste of resources,” argues Mbatia, adding that the adverse possession law tries to compel land owners to be responsible with ownership while also rewarding the squatter for taking responsibility over neglected land.
Mbatia explains that land hoarding is like any kind of hoarding - it all leads to economic sabotage.
“When commodities prices are speculated to increase, sometimes sellers halt selling, making it difficult for consumers to access them, therefore inflating the prices and creating an economic crisis. Similarly, idle land affects people’s right to housing and those who miss out are unable to self-advance, hence the need for this law.
Mbatia believes that when it comes to real estate, nature will always find a way to fill the vacuum. In the spirit of encouraging people to invest productively and use the land as a means of income generation, he wrote an eBook on, ‘27 creative ways to unlock massive profits from vacant land’.
“The idea was to present a conversation on making the land productive. A large percentage of the people I’ve sold the property to are speculative buyers situating themselves for capital gains.
Unfortunately, a lot of landowners are asset-rich but cash poor. In 2020 for instance, when people were being laid off, (due to the Covid-19 pandemic) many rushed to liquidate their land assets.
But then they would have to wait for a long period of time to sell and this compelled them to sell below market value. Many of these people were absentee, negligent landowners.
Unfortunately, even when they sold land, the money would dry up as fast because it went into consumption rather than growing their income. They became chronic sellers, eventually depleting their assets without supporting their investment strategy. In essence, says Mbatia, they could have used the land productively to generate income.
One of the simplest and most cost-effective methods of earning from land is through leasing. If you don’t have the capital to develop, you can let someone use the property productively, at a fee.
But you have to buy strategically because not all property is prime for leasing. There are many ways that one could turn land into a cash cow while keeping squatters out, from tree planting to farming, bird keeping and hosting events.
Mbatia recommends conducting a survey and a feasibility study to assess a need within the location of your land and find a way to integrate a solution to that need through the land that you own. And if you bring in other people to use the land as you speculate, keep copies of your paper trail for security.
