Ardhi House in Nairobi. The Ministry of Lands is introducing a raft of charges in land transactions, including rent on freehold land every 10 years.
Land transaction fees, levies and charges will rise sharply if Parliament approves new regulations aimed at collecting Sh59 billion annually, up from the current Sh14 billion, in non-tax revenue.
The Ministry of Lands has tabled in Parliament fresh regulations that will also see a rise in land rent payable by owners of leasehold land and freehold land every 10 years.
Cabinet Secretary for Lands, Housing, Public Works and Urban Development Alice Wahome gazzeted the regulations in November last year.
“Implementation of these regulations will lead to increased revenue collections as it is projected that the current collections of Sh14 billion will increase to Sh59 billion per year,” Ms Wahome said in the explanatory memorandum accompanying the new regulations.
“The proposed regulations are necessary for full operationalisation of the proposed Land Laws (Amendment) Bill, 2023,” she added.
The Bill seeks to review the Land Act, 2012 to revise rent payable for leasehold land and on freehold land every 10 years.
“Leaseholders are charged peppercorn rent which can be as low as Sh13. Freeholders of land in prime places like Nairobi CBD, Upper Hill, Karen, Muthaiga, Runda, Kitsuru and Lavington, among others, do not pay rent while leaseholders in less prime areas of the city such as Kayole, Umoja, Dandora, etc are charged rent. This inequity is of monumental proportions,” Ms Wahome said.
Lands Cabinet Secretary Alice Wahome addresses wananchi during the launch of affordable housing project in Nanyuki on January 10, 2024.
Raft of regulations
The Ministry is seeking to amend a raft of regulations including the Land Registration (General) Regulations, 2017, Valuers (Forms and Fees) Rules of 1987, Land Control Regulations of 1968, Land Regulations, 2017, Land Adjudication Regulations, 1970, Physical and Land Use (Planning Fees), 2021, Survey Regulations of 1994 and the Survey (Electronic Cadastre Transactions) Regulations 2021.
The regulations seek to review most of the existing statutory instruments which have not been updated for over 30 years in some cases, specifically fees and charges prescribed for various services rendered by the government in the land sector.
“The purpose of the Land Registration (General) (Amendment) Regulations 2023 is to amend the Land Registration (General) Rules 2017 by prescribing a schedule of fees and charges for various services prescribed and rendered under the Land Registration Act, 2012 and the Land Registration (General) Regulations 2017, the same having been omitted to be included during the regulation formulation process in 2017,” said the CS.
The proposed changes include an increase of charges for both electronic and manual official land searches from the current Sh500 to Sh1,000, incorporation of trusts will rise to Sh50,000 from Sh5,000 and valuation fees will increase from Sh15,000 to Sh25,000.
Consultancy fees have been set at a minimum of Sh5,000 per hour where such consultancy does not involve carrying out a valuation and compilation of a valuation report or advising on the value of property. The minimum valuation fees payable shall be Sh15,000.
Applications for registration of land documents and/or instruments and any other forms that are not prescribed will attract Sh1,000, registration of a corporation certificate will cost Sh1,500 while registration of notice of change of corporation membership has been set at Sh1,000.
Those seeking to issue a notice on termination of sectional property status will be charged Sh1,000, conversion of sub-lease to long-term leases Sh1,000, while issuance of certificate of title and certificate of lease will cost Sh2,500.
If Parliament approves the proposed rules, those seeking to resubmit for registration any document previously rejected because of an error or for failure to comply with any prerequisite of registration will part with Sh1,000 per document rejected.
Replacement of title deed will cost Sh2,500 while opening new registers consequent upon a partition, amalgamation or subdivision for each resultant parcel will attract a charge of Sh1,000.
Those seeking rectification of the register or change/correction of name not occasioned by the land registrar under section 79(1) and (3) will fork out Sh2,000.
Application for the preparation of a surrender of lease, discharge of charge, release of easement, release of profit or lease of restrictive agreement, application to sever a joint proprietorship, application for partition, notice of revocation of power of attorney or a caution under section 36 of the Act will cost Sh5,000.
The ministry will charge Sh3,000 for re-establishing a missing boundary or ascertainment of a boundary in dispute.
Caution
Those seeking to place caution or restriction other than restriction by the land registrar or government entities will fork out Sh1,000 while applicants for formal proceeding or hearing including caution, removal of caution, restriction, double registration, correction/change of name conducted by the registrar will pay Sh1,000.
Under the proposed charges, applications for certified copies of the proceedings arising from the determination of the land registrar or chief land registrar will pay Sh1,000 for the first 10 pages and Sh100 for the rest. Appeals to the chief land registrar over an order of the land registrar under section 14 of the Act will attract Sh5,000.
Land ministry officials who attend a function at a place outside the registration office for a day, and the expenses incurred in cases where the government is not a party will be paid Sh5,000 plus transport as per the AA Kenya rates and per diem as may be prescribed by the Salaries and Remuneration Commission.
“Attestation of mutations/sectional plans will attract Sh1,000 for 1-5 portions/units plus Sh500 additional 6-10 portions/units, plus addition Sh250 for additional portion/unit above 10 units.”
The ministry has also increased the fees for valuation for urban/agriculture land threshold from the current Sh2 million to Sh5 million. However, it has retained the charges at 1 per cent for the first Sh5 million and 0.25 for the residual value.
For compulsory acquisition, the threshold has been raised to Sh800,000 and attracts 10 per cent charge on the first Sh800,000 and 5 per cent for a figure that is more than Sh8000,000.
The 1987 Rules had set the threshold at Sh400,000 with a 10 per cent charge and 5 per cent for subsequent figures.
