The lengthy process of registering land and property in Kenya has long stood in the way of affordable housing. But there are signs of improvement. To begin with, the ongoing digitisation of land registries by the Ministry of Land and Physical Planning is a step in the right direction.
According to the ministry, seven of the 61 land registries in Kenya are fully digitized. The rest are expected to go digital within the next 12 months.
A key goal of digitising registries is to cut down the time taken in land or property registration. To achieve this, the ministry also aims to retain only key procedures during registration, and standardise the time required for each. This is to be achieved through consolidation of duplicated procedures.
International Finance Corporation (IFC), the private sector arm of the World Bank Group, through its Kenya Investment Climate Programme has particularly been supportive of upstream property reforms.
For instance, IFC in collaboration with the Government of Kenya has helped reduce the time and procedures involved in property registration.
Studies on Kenya’s housing sector show a direct correlation between high registration costs and high prices of houses, as they are passed down to consumers.
As a result, millions of lower income households have been priced out, or cannot get access to a mortgage due to the lack of a formal title.
Besides the ultimate goal of reducing costs, digitization will spare Kenyans the trouble of queuing at the Lands office to have their property registered and reduce avenues for rent-seeking.
Combined with changes to outdated laws and regulations, efficient titling of land along with property transfer will help sharpen the competitive edge of the country’s real estate sector.
Presently, the cost of property registration in Kenya is much higher compared to its neighbours due to registration inefficiencies.
This has had the effect of blocking most urban families from buying a house or building their own home or owning a plot.
According to IFC, getting a construction permit from the county to build a home around Nairobi involves, on average, 16 procedures and 159 workdays (six months!). This is a disincentive to aspiring property developers and eventual home owners.
To address some of these challenges, the World Bank-funded Kenya Affordable Housing Finance Project will provide technical assistance to the Land ministry to create an enabling environment for property registration, as part of the government’s goal of expanding access to affordable housing.
Among other things, the technical assistance aims to improve the quality of the ongoing digitization of land records.
The Ministry of Land, through the World Bank supported Affordable Housing Finance Project, will enhance the design of the Lands Information Management System (LIMS) to serve as the sector’s single point of reference on all data related to administering and managing land parcels.
Finally, to complement ongoing policy reforms in the land sector, Kenya also needs to consider legal reforms.
Jaramillo is World Bank country director for Eritrea, Kenya, Rwanda and Uganda Jagundokunmu is IFC regional director for eastern Africa.