There is a gap in every property purchase between the moment you pay and the moment the title is in your name. In Kenya that gap can run from a few weeks on a completed resale to several years on an off-plan unit. Escrow is the arrangement that decides who holds your money while it is open.
It is the single most useful thing to get right, and it is the thing buyers abroad most often skip, because the seller’s account details arrive by WhatsApp and look like the obvious place to send funds.
What escrow means here
An escrow arrangement puts your money with a neutral third party who releases it only when agreed conditions are met. The money leaves your account, so the seller can see you are serious, and it does not reach the seller until they have done what the contract says.
Three arrangements do this job in Kenya, and they are not equivalent.
1. Your advocate’s client account
The most common route, and the one most Kenyan conveyancing actually uses. Advocates hold client money in a designated client account, separate from the firm’s own money, under the Advocates Act and the Law Society of Kenya’s accounts rules. Your advocate releases on completion.
What it gives you: a regulated professional with a practising certificate, a duty to you, and a complaints route through the Law Society if something goes wrong.
What it does not give you: independence from your own advocate’s judgment, which is why the advocate should be yours and not one the seller recommends.
2. A bank escrow account
Several Kenyan banks offer a formal escrow product, where the bank holds funds under a tripartite agreement naming you, the seller and the release conditions. Space Kenya lists the providers we can verify on the finance directory.
What it gives you: a CBK-regulated institution holding the money, written release conditions, and an audit trail that does not depend on any individual.
What it costs: a setup fee and usually a percentage of the amount held. On a large purchase it is a real cost, and it is almost always smaller than the sum it protects.
3. A professional undertaking
Not escrow in the strict sense, but it does related work. An advocate gives a written, binding promise to do something on completion, most often to release funds once the title transfers. It is enforceable against the advocate personally.
Useful where money must move quickly. Weaker than escrow where the risk is the seller rather than the timing, because the money has usually already moved.
Off-plan is the case that matters most
On a completed house the gap is short. Off-plan, you are paying in instalments against a building that does not yet exist, sometimes for years, and the developer is using your money to build it. That is the normal shape of the product, not a warning sign in itself.
What matters is the structure around it:
- Money should not land in the developer’s ordinary operating account. An escrow or stakeholder account that releases against verified construction milestones is best practice. It is still uncommon in Kenya, so you have to ask for it by name.
- Tie the final payment to registration, not to handover, not to practical completion, and not to a certificate the developer issues to itself.
- Pay only to the official account named in the sale agreement. Never to an individual, never to an account whose details arrived in a message, and never to a changed account number without confirming it by a channel you initiated.
- Keep every receipt, and make sure each one names the unit.
The last point sounds clerical. It is what an advocate needs two years later if the project changes hands.
What to ask before anything moves
Questions a seller or developer should be able to answer without friction:
- Which account will hold the deposit, and is it an escrow, a client account, or your operating account?
- What exactly triggers each release, and who verifies that it happened?
- Is the final instalment tied to registration in my name?
- Who is the advocate on your side, and is my advocate separate from yours?
- If the project stalls, what happens to money already paid?
A seller who treats these as routine is giving you the answer you want. Hesitation on question 1 or 3 is the useful signal.
What Space Kenya does and does not do
We are a research and discovery layer. We never hold your deposit, never broker the sale, and never take a commission on one. The money moves between you, your advocate and a regulated institution. Our part is the verification that happens before you decide, and our advisory engagement is paid by the buyer for exactly that reason: the fee cannot depend on a sale closing.
Reading on from here
- Buying off-plan in Kenya, the full sequence from shortlist to registration
- How home financing works in Kenya, where the money comes from before escrow holds it
- Running an Ardhisasa search from abroad, how to confirm a title before you commit
- The finance directory, including the escrow providers we can verify
