DUE DILIGENCE CHECKLIST – WHAT TO LOOK OUT FOR BEFORE PURCHASING PROPERTY
Before purchasing property, there are several key items that an investor ought to look out for. These can be grouped into four categories; Financial, Legal, Environmental and Physical.
The following is a checklist that can guide you to get all the necessary information before investing in that property. The list is however not exhaustive.
- Reputation of the seller/selling company
- Availability of ownership documents e.g title deed, allotment letter, share certificate
- Authenticity of ownership documents especially title, allotment letters, and agreements
- Official search certificate from ministry of lands
- Cadastral maps RIM maps/mutation maps/Survey plans showing the property
- Copy of green card
- Consent to transfer
- Matrimonial status of the property
- Encumbrances on the property; charge
- Servitudes
- Easements
- Caution
- Caveats
- Ground rent; payable and outstanding
- Land rates; payable and outstanding
- Beacons and distinct boundaries
- Evidence of pollution and/or land contamination either on the subject property or adjoining properties
- Approved land use by local authority/ zoning
- Planning regulations and statutory consideration
- Availability of water, electricity and sewer
- Neighborhood historical background about the property
- Title acreage vs ground acreage
- Encroachment
- Gazetted forest land
- Road reserve
- Wetland or prone to waterlogging
- Animal migration corridor
- Ndung’u report or list of revoked titles by National Land Commission
- Public land
- Soil type
- Outstanding legal cases
- Physical property inspection
- Structural and maintenance condition of the buildings thereon
- Building plans of the existing buildings
- Occupational certificate
- Infrastructural amenities such as roads, hospitals
- Social, economic, educational and religious facilities
- Market value of the property
- Market rent of the property
- Insurance value of the property
Property valuers are professionals who give comprehensive reports on all the above items. Get a valuer to do a due diligence report on your behalf before making that final decision to purchase your property. Save time and Save Money ultimately!
AVENUE VALUERS LIMITED Publications 2023