Mistakes Were Made: Common Pitfalls in Property Purchase

Undoubtedly, purchasing property is one of the most significant financial decisions you will ever make. Whether buying land, a residential home, or a commercial investment, the process is often approached with optimism and excitement. Unfortunately, it is also a process riddled with legal, financial, and practical pitfalls.

In our experience, most property disputes do not arise from bad intentions, but from preventable mistakes made early in the transaction. This article explores some of the most common pitfalls in property purchase—and how buyers can protect themselves.

1.      Inadequate Due Diligence

Perhaps the most common and costly mistake is failing to conduct proper due diligence before committing to a purchase.

Many buyers assume that possession of a title deed alone guarantees ownership. This is a dangerous assumption. As seen in Arthi Highway Developers Limited v West End Butchery Limited & Others [2015] eKLR, the Court of Appeal cancelled titles obtained through fraudulent processes, despite the buyers holding registered title deeds. The case serves as a clear warning that purchasers must look beyond the document itself

In Kenya, due diligence should include:

(a)    A search at the Lands Registry to confirm ownership and check for encumbrances

(b)   Verification of the authenticity of the title

(c)    Investigation of whether the land is subject to caveats, charges, or court orders

(d)   Confirmation that the land is not public land or subject to compulsory acquisition

Failure to conduct thorough due diligence can result in buyers paying for property they cannot legally register in their name.

2.      Relying on Informal Agreements

Another common pitfall is relying on informal agreements, particularly where parties are known to each other. Buyers may rely on handwritten agreements, verbal assurances, or unsigned drafts.

Under Kenyan law (Law of Contract Act,S.3), contracts for the disposition of an interest in land must be in writing, signed by all parties, and attested. Informal arrangements are often unenforceable and leave buyers exposed if the seller changes their mind or disputes the terms. Case in point, the court in Nelson Kivuvani v Yuda Komora & Another [1994] eKLR, refused to enforce a land transaction that did not comply with statutory formalities

A properly drafted sale agreement protects both parties by clearly setting out the purchase price, timelines, completion documents, remedies for breach, and dispute resolution mechanisms.

3.      Paying the Purchase Price Too Early

Impatience or pressure from sellers sometimes leads buyers to release the full purchase price before completion. This is a critical mistake.

Best practice dictates that funds should be held by advocates as stakeholders and only released upon satisfaction of completion conditions. Paying directly to the seller before registration exposes the buyer to risks including:

(a)    Seller refusing to complete the transaction

(b)   Delays in transfer

(c)    Discovery of undisclosed encumbrances

Once money changes hands prematurely, the buyer’s bargaining power is significantly weakened.

4.      Ignoring Spousal or Family Interests

Property transactions frequently run into trouble where spousal or family interests are overlooked.

Under Kenyan law, matrimonial property rights can affect land transactions. If property is matrimonial property, spousal consent is required for sale. Transactions conducted without proper consent may be challenged later, even after registration.

Similarly, land that is family or ancestral land may be subject to customary interests not immediately apparent from the title. Buyers should be cautious where property is occupied or used by extended family members.

5.      Underestimating Transaction Costs

Many buyers focus solely on the purchase price and fail to budget for additional transaction costs, which can be substantial. These may include:

(a)    Stamp duty

(b)   Legal fees

(c)    Registration fees

(d)   Valuation fees

Failure to account for these costs can delay completion or strain finances at a critical stage of the transaction.

6.      Skipping Professional Advice to Save Costs

Some buyers attempt to save money by avoiding professional advice, opting to handle transactions themselves or relying on unqualified intermediaries.

While this may appear cost-effective initially, it often proves expensive in the long run. Conveyancing involves navigating complex legal, regulatory, and procedural requirements. Errors in documentation, failure to meet statutory requirements, or missed deadlines can derail an otherwise straightforward transaction.

As Arthi (supra) above rightly pointed out, the fraud could have been detected through thorough due diligence. A competent advocate would have questioned the unusually fast transfers and flagged registry irregularities

Engaging a qualified conveyancing advocate early in the process provides critical risk management and peace of mind.

7.      Overlooking Property Taxes and Ongoing Obligations

Property ownership comes with ongoing obligations that buyers sometimes overlook. These include:

(a)    Land rates payable to county governments

(b)   Land rent payable to the national government

(c)    Service charges and uncleared utility bills for sectional properties

(d)   Compliance with homeowners’ association rules, by-laws, etc

Failure to confirm outstanding liabilities may result in buyers inheriting arrears or facing enforcement action post-completion.

8.      Emotional Decision-Making

Finally, emotional attachment to property can cloud judgment. Buyers may rush decisions due to fear of losing a “good deal” or pressure from agents or sellers.

Property transactions should be approached with caution, patience, and objectivity. No deal is worth compromising legal security or financial stability.

Property purchase is a complex legal and financial undertaking. While the risks are real, most pitfalls are avoidable with proper planning, professional guidance, and informed decision-making.

Mistakes are often made not because buyers are careless, but because they underestimate the complexity of the process. By understanding these common pitfalls and seeking appropriate legal advice, buyers can protect their investment and ensure that their property acquisition is both secure and sustainable.

In property transactions, caution is not pessimism—it is prudence

Get in Touch

If you are considering purchasing property in Kenya—whether as a local buyer, diaspora investor, or foreign entity—we provide comprehensive conveyancing and real estate advisory services tailored to your needs.

We assist with due diligence, transaction structuring, contract drafting, regulatory compliance, and risk mitigation to ensure your investment is secure from the outset.

For queries or consultations, please contact us through the details provided on this website