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Bill has a legal framework, tough penalties, stringent measures to safeguard investors from unscrupulous agents. Current law is ineffective.
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Convicted violators would be liable to three years in jail, a fine up to Sh10 million or both.
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The Real Estate Regulation Bill 2023 has a legal framework, tough penalties and stringent measures to streamline the sector and safeguard investors from unscrupulous agents.
“A person who fails to comply with, shall, upon conviction, be liable,” according to the Bill.
The proposed law sponsored by Trans Nzoia Senator Allan Chesang would establish mechanisms to regulate of real estate agents and real estate projects.
To protect purchasers from unscrupulous conmen, purchasers will be entitled to obtain the information relating to approved plans, layout plans and specifications approved by authorities.
Buyers will be entitled to know time schedule of completion of the project, including the provisions for water, sanitation, electricity and other amenities and services.
In addition, investors in the multibillion-shilling real estate sector would also be required to seek registration, licensing and plan approvals if the proposed law is enacted.
“A person shall not practice as a real estate agent unless that person has been issued a practicing license by the Board of Directors and has complied with the requirements of this Act,” the Bill states.
The Bill establishes a Real Estate Board that will advise the national and county governments on the regulation and development of the real estate sector and regulate real estate agents and real estate projects.
The Board will also be responsible for the registration of real estate agents, real estate projects, licensing of real estate agents, maintaining a public database with information on real estate agents and projects.
In addition, the Board will prescribe standard fees and charges to be levied by real estate agents and developers, ensure compliance.
Chesang further proposes the establishment of a Registrar of Real Estate Agents and Projects.
The Registrar shall maintain a register of real estate agents and real estate projects, receive applications for registration and, with the approval of the Board of Directors, register real estate agents and real estate projects.
The Registrar may suspend or revoke the registration of a real estate agent or real estate project and perform such other functions as may be assigned by the Board of Directors.
“The Registrar shall serve for a term of five years and shall not be eligible for re-appointment.”
The Bill proposes that where the name of a person is entered in the register, the registrar shall issue to him or her a certificate of registration in such form as the Board may prescribe and the certificate shall remain the property of the Board.
“A certificate of registration issued by the registrar shall be valid and shall remain in force for one year, but shall be renewable on the payment of the prescribed fee.”
The Registrar shall establish and maintain an online digital real estate portal to facilitate the registration of real estate agents and the registration of real estate projects.
The portal will also help provide access to finance, information, innovation and the global market for real estate agents and developers.
Chesang said the Kenyan economy is the largest economy in East Africa with a real estate market turnover of more than Sh100 billion annually, thus the need for regulation.
He said the sector has witnessed a lot of fraud in the recent past, hence, the need for a regulatory regime as the current regime has been ineffective in regulating the sector.