KENYA Law and Practice Contributed by: Anne Kinyanjui and Bonface Abuya, DLA Piper Africa, Kenya (IKM Advocates)
Impact of Inflation and Increases in Interest Rates Rising inflation and increasing interest rates have affected real estate transactions in the following ways: • investors have been risk averse, leading to low demand for real estate products and low uptake of loans from local banks; • investors are increasingly turning to non-bank financing sources; • financial products, including mortgages, have been increasingly costly, due to rising interest rates and the weakening Kenyan shilling; • the high cost of living has prompted rent and loan payment defaults and forfeitures; • construction materials remain expensive; and • there has been a greater appetite for afford - able housing solutions. Impact of Disruptive Technologies The following digital solutions have been adopt - ed: • the digitisation and digitalisation of courts, not only reducing the time taken to file and process cases but also increasing transpar - ency; • the digitisation of land records and the launch of the Ardhisasa platform by the Ministry of Lands and Physical Planning (the Ardhisasa platform is progressively improving, albeit with some technical challenges); • the digitisation of the collateral registry of security rights over movable assets under the Movable Property Security Rights Act; • the Business Laws (Amendment) Act, 2020 to enable the digital execution of land-related documents is yet to be fully implemented; • mobile money payment is available for land transactions;
• proptech solutions such as Airbnb, xPodd, virtual reality site visits and smart homes are popular in Kenya; and • 3D printing building technology was intro - duced in construction in order to promote and fast track the delivery of affordable housing.. These technologies will have the following effects: • the cost of real estate transactions will be reduced; • land transactions will be easier; • construction will be more efficient; and • there will be reduced reliance on intermediar - The Local Content Bill, 2023 seeks to create a comprehensive legal framework for the devel - opment and adoption of local content through ownership, control and financing of activities connected with the exploitation of gas, oil and other petroleum resources. ies in real estate transactions. 1.3 Proposals for Reform The Natural Resources (Benefit Sharing) Bill, 2022 seeks to establish a system of benefit sharing in natural resource exploitation between resource exploiters, the national government, county governments and local communities. The Land Control Bill, 2022 seeks to rationalise the law on dealings in agricultural land with the provisions of the Constitution, the Environmental and Land Court Act, the LA and the LRA. The Bill proposes to introduce Land Control Commit - tees, which will regulate dealings in agricultural land in accordance with the law and traditions, customs and the way of life in the community of the controlled area.
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