• April 15, 2024
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Proposed Bill punitive to investors, says Real estate agent

Proposed Bill punitive to investors, says Real estate agent

Molo,

Sunday March 24, 2024

KNA by Emily Kadzo

Founder and Chief Executive Officer of Hyssop Properties Mr Naftali Mwangi says the Bill which seeks to amend the Land Act, 2012 to provide for registration, licensing, and regulation of over 200 land dealing entities in the country was bad for investors.

While terming the Bill as restrictive and anti-capitalist Mr Mwangi expressed concern that if approved into law it will put a limit on Kenya’s social-economic progress.He said Real estate players were not consulted over a proposed legislation that seeks to compel land-buying companies to deposit Sh500 million before being registered.

He further noted that the proposal by the Parliamentary Budget Office (PBO) that the annual registration fee for land buying firms to be Sh100, 000 will lead to the collapse of many firms while locking out thousands of Kenyans willing to invest in the sector as the amount was way above the reach of most citizens.

Speaking at Sobea in Nakuru-Town West Subcounty when he presided over issuance of 315 title deeds for parcels of land sold to private developers by Hyssop Properties, Mwangi said sponsor of the Bill, Kirinyaga Central MP Joseph Gitari should have involved the Association of Real Estate Stakeholders which represents players in the industry before drafting the proposed legislation.

Mr Mwangi indicated that real estate offers two million direct jobs and five million jobs indirectly adding that sixty per cent of diaspora remittances are also handled by the sector.

The CEO however affirmed that there should be no substitute for honesty and integrity in the real estate industry.

He conceded that lately, the sector has witnessed the proliferation of new associations that purport to register and champion the interests of real estate agents and property managers.

Most of them he noted are mutations of land buying companies that have previously swindled unsuspecting Kenyans out of their hard- earned money, selling them air instead of land.Mr Mwangi said Hyssop Properties’ operations were grounded in integrity and a culture of trust.

The CEO explained that the new property owners were eligible for Hyssop’s ‘Turning plots into homes’ program where the firm has signed a deal with two financial institutions towards financing of up to 90 percent of costs of building a house capped at Shs 10 million.

A Seventh Day Adventist Senior Pastor Robert Tinega whose church was allocated a plot free of charge by Hyssop Properties however said it was a bit too early to fault the new bill which is also seeking to protect the interests of buyers who have ended up being conned after buying land either without title deeds or those allocated to more than one person.

Mr Tinega said he had previously lost Shs 500,000 in a fraudulent land scheme perpetrated by crooked businessmen.

The proposed law further seeks to create an agency that would control the increase of land-buying companies in the country.

Under the proposed law the regulator will have powers to impose penalties of up to Sh5 million for non-compliance by the land-buying companies.

Pastor Tinega said he believed that the MP was motivated to move the amendment bill to save investors who have been conned by such companies’ rogue professionals like lawyers, land surveyors and land valuers into buying non-existent parcels of land due to a lack of sufficient laws to regulate land buying entities.

“To regulate this industry a law needs to be enacted to bring sanity and protect innocent buyers from falling prey to these companies,” noted the cleric

He added, “there is no legislation or policy that regulates the operations of land dealing companies. The directors capitalize on this loophole to rip-off unsuspecting buyers.”

At the same time, the clergyman urged real estate companies to invest in Nakuru as it was strategically located and an emerging industrial hub in the Rift Valley region.

Pastor Tinega indicated that due to good infrastructure and vibrant agricultural activities that guaranteed a steady supply of raw materials to industries and food stuff for the populace, the county was better placed as a destination for domestic and industrial activities.

Under the new law an agency that would regulate the proliferation and activities of all land-buying companies will be established.

The Bill provides for payment of a registration fee by each land dealing company which will be prescribed by the Cabinet Secretary responsible for Land and renewed every year.

Pastor Tinega also cited an instance where his colleague lost millions of shillings to a land buying con scheme in Nairobi.

He noted that most of those who have fallen victims to the unscrupulous companies have been denied justice even after reporting to the security agencies as there are regulatory instruments.

He said the establishment of a registration and regulation mechanism for land-dealing entities will go a long way in providing policies that will protect Kenyans from exploitation by fraudulent land-buying and selling companies.

Several Kenyans have lost their money through unregulated investment companies that operate real estate businesses that sell the property as “off plan”.

Cases of rampant fraud perpetuated by real estate firms last year prompted the Directorate of Criminal Investigations (DCI) to launch investigations into various companies that Kenyans complained about.

The DCI appointed a 26-member special team of investigators with backgrounds in land matters to the Land Fraud Investigations Unit.

The 26 detectives with professional backgrounds in land survey, land economics, land physical planning and administration, among other relevant fields have been deployed to the unit.

Courtesy; KNA

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