The Buying and Selling Costs of Real Estate Transactions in Kenya

As would be expected, there are several transactions involved in buying and selling character, which attract fees and taxes. In Kenya, you incur charges from the moment you begin searching for possible investment ventures.

While some costs are set, such as registration and required search fees, many costs associated with buying and selling real estate in Kenya are highly variable and based on:

  • The kind of real estate
  • Location of the character
  • Commissions and fees charged and earned by the various professionals (which are also often based on kind and location of the character)
  • The kind of transactions
  • Documents you want or need

The estimated sum for round trip transactions can range from 4.5% to 6.8% of the selling/buying price of the real estate.

Real-estate Agent Fees

  • Searching fees: rates vary depending on the kind, size and cost of character with an urban apartment in upmarket neighborhood costing as much as Ksh5,000
  • Viewing fees: varies among real estate agents but usually ranges between Ksh500- 1000 for residential houses and over Kshs5,000 for commercial similarities
  • Listing Fees: varies depending on size and location of character with landlords paying from 2% the value of the character
  • Agent’s commission (buyer & seller): 1.25% of the sale price

character required Search Fees

  • Preliminary required search fee: Ksh500
  • Costs of obtaining required completion documents (seller): Kshs500

Registration Costs

  • Registration fees: Ksh500
  • Banker’s cheque fee: Kshs600
  • Land rent clearance certificate: Kshs 7,500

Stamp Duties

Stamp duties are taxes tied to documents and real-estate sale/buy transactions. It’s usually based on the sale price of the character.

  • Duly signed sales agreement: Ksh200 for original copy and Kshs20 for each copy
  • character move (similarities within municipalities): 4% flat rate
  • character move (outside municipalities): 2% flat rate
  • Mortgage: 0.1% of the amount of mortgage
  • character leased for less than 3 years: 1% flat rate
  • character leased over a duration of 3yrs: 2% flat rate stamp duty

Taxes

  • Income tax (non-residents): 30% of gross rental income
  • Income tax (foreign companies): 37.50% flat rate
  • Annual character tax: varies across locations and character value but is usually 1% of the character value
  • Land tax: varies by location of the land and is most costly in major towns such as Nairobi with rates as high as 8%

Legal and Mortgage Fees

  • Legal charges related with taking mortgage

    • Depends on amount of mortgage you take (higher mortgages average higher fees) but mostly the rates are between 0.5-1.5% of the value of character
  • character insurance: varies with duration of loan repayment and lender
  • Mortgage life policy: charged at 0.3% and 0.6% of the mortgage loan per year
  • Mortgage negotiation fees: although it varies, most lenders ask for 1% of the mortgage amount
  • Mortgage indemnity insurance: often ranges between 5 – 10% of the value of character
  • Legal fees related with lawyer overseeing sale course of action: 1.5%

Other Important Costs

  • Survey fees: Ksh 5, 000 consultation fee.

    • Survey fees are determined by the survey work done
  • Valuation charges: usually Kshs5,000 consultation fee

    • However, the actual valuation fee depends on character value. for example valuation charges for urban similarities valued Ksh10 million method Ksh40,000
  • Residency permit fees: accompanied by non-refundable processing fees and the fees vary depending with the kind of permit you need. for example:
  1. Class D- Kshs200,000 yearly with 10,000 non-refundable fees
  2. Class I- Kshs5,000 with Kshs1,000 non-refundable fee
  3. Class A- Kshs250, 000 and 10,000 non- refundable, etc.

Company setup costs: depends on kind and size of company and its location

Utility reconnection fees include

  • Electricity place fees: standard Ksh2,500
  • Water place fees: standard Ksh1,000

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