Introduction
When buying property in Nairobi’s upmarket hubs like Westlands, the term “leasehold” often pops up—and it’s more than just a technicality. Most prime land in Westlands is not freehold but leasehold, meaning buyers don’t own it outright. Instead, ownership is tied to time-bound leases—often 50 or 99 years—with strict rules on renewal, use, and transfer.
For investors and homeowners, leasehold terms shape not only your rights today but also the future resale value of your property. Imagine paying hundreds of millions for a luxury apartment or office tower, only to realize your lease has just 20 years left. Such details can make or break your investment.
In this blog, we break down 7 key facts every buyer must know about leasehold land in Westlands—from tenure length and renewal fees to Ardhisasa title verification and hidden legal costs.
In Nairobi’s upmarket suburbs like Westlands, most land is held under leasehold tenure. This means that even though you legally own the property built on the land, the land itself is leased from the government for a specific period—usually 50 or 99 years.
While this is standard practice, many buyers overlook the implications of leasehold ownership until it’s too late. From renewal costs to financing limitations, understanding how leasehold tenure works can help you make smarter and safer real estate decisions.
Below, we break down the key factors every buyer should consider before investing in a leasehold property in Westlands.
1. Leasehold Tenure Is Time-Bound
Leasehold ownership comes with fixed terms, typically 50 or 99 years, after which the lease must be renewed through the Ministry of Lands. Renewal is not automatic, meaning that the government has to review and approve each application.
Delays or disputes during renewal can affect your property’s resale value and make it difficult to secure financing. It’s therefore critical to check the remaining years on the lease before committing to a purchase—especially if the term left is below 40 years.
Pro Tip: Always request a lease abstract from the seller or your conveyancing lawyer to confirm the remaining years before signing any agreement.
2. Renewal Costs Can Be Significant
Renewing a lease involves several costs, often underestimated by buyers. These include:
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Land revaluation fees, which can increase sharply in high-demand areas like Westlands.
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Annual land rent, payable to the government.
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Legal and administrative charges related to processing the renewal.
If these costs are not budgeted for early, they can come as a surprise. Failing to renew on time can even result in forfeiture of the land, which means the government reclaims ownership.
3. Title Verification Is Crucial
Due diligence starts with verifying the title. Through Kenya’s Ardhisasa platform, buyers can now confirm ownership details and tenure information digitally.
A comprehensive title search will reveal:
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The number of years remaining on the lease.
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Any caveats, encumbrances, or disputes tied to the land.
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Whether land rent and rates have been paid up to date.
Never rely solely on physical title documents. Always validate the details on Ardhisasa before making payment or signing an agreement.
4. Restrictions Apply to Land Use
Leasehold titles often come with government-imposed restrictions that dictate how the land can be used. These may include:
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Land-use designation (residential, commercial, or mixed-use).
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Building height limits, especially in residential zones.
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Subdivision rules, controlling how plots can be divided or developed.
Violating these restrictions can lead to penalties, demolition orders, or lengthy legal battles. Always consult the County Physical Planning Department or a qualified real estate lawyer before altering land use or commencing construction.
5. Banks and Financiers Consider Lease Length
When applying for a mortgage, the length of the remaining lease is a key consideration. Most Kenyan banks are unwilling to finance properties with less than 25 years remaining on the lease.
This limitation affects not only buyers seeking loans but also sellers—since a shorter lease narrows the pool of eligible buyers, making resale harder.
If you’re buying with financing, ensure that the lease term aligns with your loan repayment period to avoid complications during approval.
6. Foreign Buyers Are Limited to Leasehold
Under Kenya’s Constitution (Article 65), non-citizens and foreign-owned companies cannot own freehold land. Instead, they are granted leasehold titles, typically capped at 99 years.
This policy ensures compliance with national land laws while still allowing foreign investors to participate in Nairobi’s lucrative real estate market—especially in Westlands, Kilimani, and Riverside, where demand from expatriates remains strong.
Foreign investors should work with registered agents and lawyers familiar with leasehold transfers to ensure compliance with Kenyan property laws.
7. Legal and Transfer Costs Add Up
Buying leasehold property involves more than just the purchase price. Investors must also factor in additional transaction costs, such as:
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Stamp Duty: 4% of the property’s value in Nairobi.
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Legal Fees: Typically 1–2% of the purchase price.
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Lease Registration Costs: Payable to the Ministry of Lands.
These costs can add up to 6–8% of the total transaction value, so it’s vital to budget accurately before making an offer.
Conclusion
Leasehold land in Westlands is not a disadvantage—it’s the standard form of tenure for most urban properties in Nairobi. However, it comes with legal, financial, and procedural complexities that buyers must fully understand before purchasing.
From checking lease duration and budgeting for renewal costs to verifying titles and understanding land-use restrictions, due diligence is your best protection. In Nairobi’s high-value real estate market, the difference between a smooth transaction and a costly legal nightmare often comes down to preparation and expert guidance.
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