Off-plan is one of the most accessible ways to own a brand-new home in Kenya. You buy a unit (usually an apartment) before it is finished, you pay in stages while the developer builds, and you receive the completed unit and your title at the end, often two to four years later. It is popular for good reasons: prices are usually lower than a finished unit, you pay in instalments rather than all at once, and the value can grow before you even move in.
The buyers who do very well share one discipline. They verify everything in public records, they engage their own advocate, they tie money to registered title and real construction progress, and they read the contract before they sign. This guide walks you through exactly how to do that, step by step. It is general information current to 2026, drawn from Kenyan property law and real off-plan transaction documents. It is not legal, tax, or financial advice; engage a qualified Kenyan advocate and tax adviser for your specific transaction before signing or paying anything.
The one idea everything flows from. Off-plan is financing a developer to build you a home. Treat every shilling as money at risk until your name is on a registered title. Verify first, pay in stages, and keep the final payment tied to the title landing in your name.
1. What “off-plan” really means
Buying off-plan means paying for a home before it is built, sometimes before a single block has been laid. You are buying a promise on paper: drawings, a brochure, a show-house, and a contract. You pay in instalments as the developer builds, and you take delivery of the finished unit and its title at the end.
Because you are paying for something that does not yet exist, the diligence you do up front is what protects you. The good news is that the signals worth checking are public and specific, and most problems are avoidable when you know what to look for.
2. What can go wrong, and how you stay ahead of it
Naming the failure modes is how you design around them. Each item below is a reason to verify a specific public record before money moves.
- An unfinished build. A developer can run short of funds, pause a site, or become insolvent. Your protection is to vet the developer’s track record and tie instalments to verified milestones (Sections 4 and 8).
- Long delays. “Ready in two years” can become five. Contracts often give the developer wide excuses and offer the buyer no compensation for delay. Your protection is a firm completion date, a longstop date, and a tight force-majeure clause (Section 7).
- A unit that differs from the brochure. Sizes, finishes, and amenities can shrink. Your protection is a clause that limits the developer’s right to substitute materials and vary layouts (Section 7).
- Title that is not clean or not ready. The developer may not fully own the land, it may be charged to a bank, or your individual title may be years away. Your protection is an official search and a completion that is conditional on a registered, clean title (Sections 5 and 7).
- Missing approvals. A genuine project carries a county permit, an environmental licence, and a registered contractor. Your protection is to verify each approval against its official portal (Section 6).
- A lease that is too short. A unit on land with few years left on its lease is hard to mortgage and hard to resell. Your protection is to confirm the unexpired term (Section 3).
- Punitive contract terms. Some contracts punish a late buyer heavily while letting a late developer off lightly. Your protection is to mirror the penalties both ways (Section 7).
- Outright fraud. Your protection is independent verification of the title, the company, and the approvals, and paying only to the official account named in the contract (Section 14).
3. Kenya’s land and title system in plain English
Freehold vs leasehold
Freehold means you own the land outright, with no time limit. Leasehold means you own it for a fixed number of years (commonly 99, sometimes 50) granted by the Government, after which it must be renewed. Most apartments in Nairobi sit on leasehold land.
The unexpired term is what matters
The single most important number on a leasehold title is how many years remain, not the original length. A 99-year lease that started in 1956 has very little time left today. When the remaining term is short (for example under roughly 40 to 45 years), banks will decline a mortgage on it and future buyers tend to avoid it, so the unit becomes hard to sell or finance. Always ask: “When did the head lease start, and how many years are left?” Read it from the title document, not from the salesperson.
Lease extension and “change of user”
A developer with a short or wrongly-zoned lease will often promise to “extend the lease” and “change the user” (for example, from a single house to apartments). These are real, legitimate processes, and they run through several stages:
- Apply to the county and advertise a public notice in a newspaper.
- Obtain county (planning) approval.
- Obtain National Land Commission confirmation.
- Have the new lease term registered on the title at the Lands Registry.
A promise is not the same as a completed, registered change. Buyers are routinely handed “proof” that is actually a scanned newspaper page carrying the public-notice advert (the very first step) or a county approval letter. Only the updated, registered title proves the lease has changed. Until you see that, treat the lease as the old, short one, and hold your payment.
Sectional titles: how apartments are owned
Under the Sectional Properties Act 2020, each apartment (“section”) receives its own separate title plus a shared interest in the common areas (corridors, grounds, lifts). When the building’s sectional plan is registered, a management corporation forms automatically; every owner is a member, and it runs the common property and collects the service charge.
- Confirm you will receive a separate sectional title in your name, not merely “a share”.
- Older apartments on long-term company leases were required to convert to sectional titles (a deadline ran into 2026). An unconverted unit is harder to sell, mortgage, or transfer, so ask about conversion status.
- The management corporation sets and enforces the service charge. Ask how it is run and what the charges are.
Ardhisasa: the digital land system
Kenya’s land records, especially in Nairobi, now run on the Ardhisasa platform. An official search there (about KES 500) shows the registered owner, the lease term, and any charges or cautions. Brand-new sectional units may not yet appear on Ardhisasa, so your advocate may need to verify them directly at the registry.
If you are not a Kenyan citizen
Non-citizens cannot hold freehold land and are limited to leasehold of up to 99 years. Foreign buyers should take specific advice on ownership structure and any approvals before committing.
4. Vet the developer before you fall in love with the show-house
- Get a CR12 from the Companies Registry. It reveals the company’s real directors and shareholders, so you know who you are actually dealing with.
- Check the track record. Visit past completed projects, talk to owners, and ask whether the developer finished on time, whether quality matched the promise, and whether titles were issued.
- Search for court cases. Look up the company and its directors on the Kenya Law website (new.kenyalaw.org) for disputes or insolvency.
- Check financial seriousness. Is the project financed, and by whom? A bank financing the build can be reassuring, and it can also mean the land is charged to that bank (see Section 5).
- Confirm the contractor is registered with the National Construction Authority (NCA) in a category appropriate to the scale of work.
5. Vet the land and title
- Run an official search (Ardhisasa or the Lands Registry) on the title the project sits on, and confirm the developer is the registered owner.
- Read the encumbrances section. This is where charges (bank loans and mortgages), caveats, cautions, and court orders appear. A clean (“nil”) encumbrances section is what you want.
- Confirm the lease term and unexpired years (Section 3).
- Check the dependencies. If the project relies on amalgamating two plots, or on a lease extension or change of user, confirm whether those are actually registered yet, or still only applied for.
- Confirm land rates (county) and land rent (national) are paid up, and obtain clearance certificates.
- Mind the consents. If the seller is an individual and married, spousal consent may be required. If the land is agricultural, Land Control Board consent is needed within six months, or the sale is void.
The hidden-charge trap. A developer financing construction may place a bank charge over the whole parcel. If the project stalls, the bank can sell the land even though you have paid. Insist the contract requires the financier to acknowledge your interest in writing and to release your unit on completion, and that you receive notice of any charge.
6. The approvals a genuine project carries
Ask to see, and independently verify, each of these. Genuine approvals carry official letterheads, reference numbers, and QR codes you can check on the relevant portal.
| Approval | Who issues it | What it confirms |
|---|---|---|
| Building plan / development permit | County Government, under the Physical and Land Use Planning Act 2019 | The building (size, height, units) is approved |
| Change of User | County Government | The land may legally be used for what is being built. It often lapses if construction is not completed within about three years |
| Extension of Lease | County, National Land Commission, Lands Registry | A longer lease term, real only once registered on the title |
| EIA Licence | NEMA (the environmental authority) | Environmental approval, usually to start within a set window |
| Contractor registration | National Construction Authority (NCA) | The builder is licensed for that scale of work |
| Water authorisation | WRA / WRMA where relevant | Lawful water use |
Verify, do not just collect. Approvals can be forged. Scan the QR codes and check reference numbers against the official portals (Ardhisasa, the county e-permit system, NEMA, NCA). Watch for the same project described under different plot numbers or different applicant names across documents, and ask your advocate to reconcile them.
7. The documents you sign, and the clauses that matter
The sequence
- Reservation / booking form. A small fee to hold the unit. Check whether it is refundable.
- Letter of Offer. Sets the headline terms: price, payment schedule, and what happens if you pull out. In Kenya, signing the Letter of Offer often creates a binding agreement on those headline terms, so read it closely before you sign.
- Agreement for Sale (the SPA). The full contract, usually drafted by the developer’s advocate and presented for signature, often within about 30 days. This is your negotiation window; use it before you sign.
Clauses to read carefully and negotiate
- Completion date and delay. Is there a firm date or only an estimate? Is there a longstop date after which you can walk away with a full refund plus interest? How broad is the force-majeure clause, and is there any compensation if the developer is late? (Usually none; try to add some.)
- What you are buying, tied to title. Make final payment and completion conditional on the developer delivering a registered, clean title (including any promised amalgamation and a minimum lease term), not a vague “term as may be granted”.
- If you default. Typical contracts forfeit around 10% of the price as liquidated damages plus the developer’s legal fees, and refund the rest without interest, often after 60 days. Know this number.
- Interest on late payments. Watch for high rates and daily compounding (for example, “4% above the Central Bank rate, compounded daily, automatic after 7 days”). Push for simple interest, a grace period, and notice before it bites.
- If the developer defaults. Ensure you recover all money paid plus interest, mirroring the penalty imposed on you.
- Payment vs registration sequence. Avoid paying 100% before the unit is registered in your name. Tie the final payment to registration, through escrow or a lawyer’s professional undertaking.
- Substitution and variation. Limit the developer’s right to change materials, sizes, and layouts.
- Assignment and nomination. If you may later move the unit into a company or family vehicle, preserve the right to nominate or novate; the contract may require the developer’s consent and a fee.
- Extra stamp duty on valuation. Many contracts make you pay any extra stamp duty (if the Government valuation exceeds the price) within a few days, on pain of breach; try to widen that window.
- Your own advocate. Contracts often note the purchaser’s advocate as “TBA” and state that if you do not appoint one, the developer’s lawyer owes you no duty of care. That alone is the reason to appoint your own (Section 9).
8. The money: price is only the start
Budget for the extras, because they are large
On top of the purchase price, expect outgoings that can add roughly 6% to 7% or more. On a typical Nairobi apartment these include:
| Cost | Rough amount |
|---|---|
| Stamp duty (urban) | 4% of value (2% rural) |
| Developer’s advocate legal fee | About 1% of price plus 16% VAT |
| Your own advocate | Per the Advocates Remuneration scale (Section 9) |
| Sectional plan, geo-referencing, title issuance | A fixed proportionate sum |
| Management corporation registration and share | A modest fixed sum |
| Water and electricity meter deposits | Fixed sums |
| Service charge deposit (often 3 months upfront) | Monthly rate times three |
| Valuation, stamping, and registration disbursements | A fixed sum |
A unit advertised at, say, KES 16.7M can carry around KES 1M or more in additional outgoings, so the true all-in cost is closer to KES 17.7M. Always ask for the full schedule of outgoings in writing before you commit, and budget the extras.
How to pay: escrow and milestones
Off-plan money is safest when it is not paid into the developer’s ordinary account. Best practice, still uncommon in Kenya, so you must ask for it, is an escrow or stakeholder account that releases funds as verified construction milestones are reached, rather than on arbitrary calendar dates. If escrow is not offered:
- Push to tie instalments to construction progress, not just to dates.
- Keep proof of every payment (receipts naming the unit, and bank transfer records).
- Pay strictly to the official account named in the contract. Fraudsters swap account details by email, so confirm any change by phone with a known contact.
9. Get your own advocate, an independent conveyancer
The developer’s lawyer acts for the developer. Engage your own independent advocate to verify the title, the approvals, and the lease, and to mark up the contract before you sign.
- What they do. Official searches, interpretation of encumbrances, verification of sectional-title and lease-extension status, negotiation of the Sale Agreement, and the transfer and registration at completion.
- What it costs. Conveyancing fees are scale-regulated by the Advocates (Remuneration) Order, roughly a percentage of value (around 1% on higher-value property, plus 16% VAT), so price is broadly similar across firms; compete on expertise and responsiveness. A searches-and-due-diligence-only engagement, before any transfer, typically costs less than full conveyancing.
- Confirm the advocate is real. Check the practising certificate with the Law Society of Kenya (online.lsk.or.ke), and get a written conflict-of-interest confirmation that they do not act for the developer.
10. Taxes you will meet
| Tax | Rate (2026) | Who pays, and when |
|---|---|---|
| Stamp duty | 4% urban / 2% rural of value | Buyer, before transfer is registered (on completion) |
| Monthly Rental Income tax (MRI) | 7.5% of gross rent (residential; gross rent KES 288k to 15M per year) | Landlord, monthly via KRA, a final tax with no expense deductions |
| Capital Gains Tax | 15% of the net gain | Seller, within 30 days of transfer (when you eventually sell) |
| VAT | 16% | Generally not on residential sale or rent, but it applies to commercial property and to professional fees |
You will need a KRA PIN to transact. Landlords register on KRA’s electronic rental system and file monthly.
11. Financing your purchase
- Off-plan can sometimes be part-financed by a mortgage, and banks lend against completed, titled units with a sufficient unexpired lease. A short lease (Section 3) can make a unit difficult to mortgage.
- If you will use a mortgage, build the bank’s requirements (letter of guarantee, professional undertaking, timelines) into the contract. Developers often impose strict deadlines on financed buyers.
- Size your instalments to what you can meet comfortably, not only if everything goes perfectly, because the penalty for a late buyer is usually severe.
12. Completion: getting your keys and your title
- Occupation Certificate. The county confirms the building is fit to occupy. Completion is usually pegged to this.
- Practical completion and snagging. Expect an architect’s certificate of practical completion and a defects-liability period (often around six months) to fix snags. Inspect carefully and list defects promptly.
- Your title. The registered sectional title in your name, plus your membership in the management corporation. Treat the deal as done only when this is in hand.
- Completion documents your advocate should collect. The title, the registered transfer, the sectional plan, the occupation certificate, rates and rent clearances, the corporation registration and by-laws, and the developer’s company and KRA documents.
- Service charge. Understand how it is set, what it covers, and whether increases are capped.
13. If you are buying to let it out
- Register for and pay Monthly Rental Income tax (Section 10); KRA actively enforces this.
- Use a written tenancy agreement, and understand deposit handling and notice periods. Lower-rent residential tenancies can fall under rent-control rules, while others follow ordinary contract and landlord-tenant law.
- Factor in service charge, vacancy, and management when you calculate yield. The headline rent is not your profit. For the renting side in detail, see our practical renting guide.
14. Red flags and common scams
- Pressure to “pay today to lock the price”, with no time to do due diligence.
- Reluctance or delay in providing the title, CR12, and approvals for independent checking.
- “Proof” of a lease extension or approval that is only a newspaper notice or an application, rather than a registered document.
- Payment requested to a personal account, or a sudden “change of bank details” by email.
- Prices far below market; when something looks too good to be true, it usually is.
- The same plot or project appearing under different numbers or names across documents.
- Being discouraged from using your own advocate.
15. Your step-by-step roadmap
- Shortlist the unit; get the title number, the developer name, and all approvals in writing.
- Engage your own advocate, independent of the developer.
- Run an official title search; verify the owner, the lease term, and the encumbrances.
- Verify the approvals (county permit, change of user, NEMA, NCA) against the portals.
- Confirm the lease is long enough, and that any extension or amalgamation is registered, not just applied for.
- Get the full price, outgoings, and payment schedule in writing; arrange financing if needed.
- Have your advocate mark up the Sale Agreement (Section 7) before you sign.
- Insist on escrow or milestone-linked payments; pay only to the official account; keep every receipt.
- Pay in stages as the build progresses; never pay 100% before registration.
- At completion, inspect, snag, then collect your registered sectional title and corporation membership.
16. Quick due-diligence checklist
- ☐ Official title search done; owner equals developer; encumbrances clean
- ☐ Lease term confirmed; enough unexpired years to mortgage
- ☐ Any extension, change of user, or amalgamation is registered
- ☐ CR12 obtained; directors known; no adverse court cases
- ☐ Developer track record checked (visited a completed project)
- ☐ County building permit and change of user verified
- ☐ NEMA EIA licence verified; NCA contractor verified
- ☐ Sectional plan and a separate title for your unit confirmed
- ☐ Full price and all outgoings in writing, and budgeted
- ☐ Payment to the official account; escrow or milestones in place
- ☐ Sale Agreement reviewed and marked up by your own advocate
- ☐ Default, interest, completion-date, and refund clauses understood
- ☐ KRA PIN ready; stamp duty budgeted
- ☐ Advocate’s LSK practising certificate verified; conflict check done
17. Key laws and bodies (glossary)
| Name | What it governs |
|---|---|
| Land Registration Act 2012 / Land Act 2012 | Title registration, transfers, leases, charges |
| Sectional Properties Act 2020 (and Regulations 2021) | Apartment ownership, sectional titles, management corporations |
| Physical and Land Use Planning Act 2019 | County planning approvals, change of user, lease extension applications |
| Law of Contract Act (Cap 23) | Enforceability of sale agreements; written, signed, witnessed |
| Law Society of Kenya Conditions of Sale 2015 | Standard conveyancing terms incorporated into most sale agreements |
| Advocates (Remuneration) Order | Lawyers’ scale conveyancing fees |
| EMCA / NEMA | Environmental impact assessment and licensing |
| National Construction Authority Act | Contractor registration and site compliance |
| National Land Commission | Public land, lease extensions and renewals |
| Income Tax Act / KRA | Stamp duty, rental income tax, capital gains tax |
| Matrimonial Property Act / Land Control Act | Spousal consent; agricultural-land board consent |
| Ardhisasa (NLIMS) | The digital land-records and search platform |
Where Space Kenya fits
Off-plan rewards preparation, and that is exactly the layer we provide. Space Kenya is the diligence and discovery layer over Kenya’s property content. We help you research a development, watch the verified video coverage, read the public facts, and walk the corridor of infrastructure and public works that shapes future value. We are not a broker, and we do not hold buyer funds; your transaction, your escrow, and your conveyancing stay with your own advocate and your bank, where they belong.
- See the hands-on approach on our off-plan playbook.
- Buying from abroad? Start with the diaspora guide and the diaspora off-plan playbook.
- Track the public works that lift corridor value.
- Renting or buying a ready home instead? The Network routes you to content-verified Realtors.
This guide is general information current to 2026, drawn from Kenyan property law and real off-plan transaction documents. It is not legal, tax, or financial advice. Laws, rates, and fees change. Always engage a qualified Kenyan advocate and tax adviser for your specific transaction before signing or paying anything.