How to Identify and Avoid Real Estate Scams in Kenya

Investing in Kenya’s real estate market can be a lucrative venture, but it is important to be aware of the potential scams that could derail your plans. From fraudulent property listings to forged documents, there are a number of scams that you should avoid when investing in Kenyan real estate.

In this article, we will look at some common scams and how to protect yourself from them. By being informed and aware of the risks involved in investing in Kenyan real estate, you can ensure that your investments are safe and secure.

How to identify and avoid Real estate scams in Kenya

In the recent past, several real estate scam companies have collapsed.  There are common scams that a lot of Kenyans keep falling for due to a lack of knowledge or just bad assumptions on their side.

Some real estate dealings where success was questioned are:

1.   Suraya Properties

Suraya Properties had Kenyans lose millions in the housing scheme. Some Suraya housing projects collapsed.  Clients flocked to Suraya offices seeking redress. Duped Kenyans reported the matter to DCI.

2.   The Ekeza /Gakuyo Sacco Housing

A Bishop named Mr. David Ngari introduced an attractive and affordable housing scheme, which drew in thousands of Kenyan participants, including over 5,000 members living abroad. However, after several months of saving, these individuals were left disappointed when they had to spend time at the DCI Headquarters filing complaints. This outcome was a double tragedy, as it is estimated that members had collectively saved over Sh3 billion by April 2017, only for it to go to waste.

3.   The Simple Homes

In October 2015, a new opportunity presented itself in the form of Simple Homes, offering hope to many middle-class Kenyans who desired to own a respectable home.

The firm was crafty. They used a rent-to-own model allowing individuals to purchase a home at the cost of their monthly rent.

4.   Banda Homes.

At the height of this project, messages did rounds on social media accusing Banda Homes Limited of short-changing their buyers. The developer faced allegations of failing to deliver homes to buyers despite having received deposits amounting to Ksh1.5 billion.

What Are the Common Scams to Look Out For When Investing in Kenyan Real Estate?

The following is a summary of the strategies frequently employed by fraudulent real estate agents in Kenya and how potential buyers can protect themselves from falling victim to these scams.

1.   Title Fraud

This is a common scam that is often successful in deceiving first-time property buyers. You only realize you share the same title with other people when it is too late. This may result when companies sell the same plot and issue certificates to several people.

Scammers will steal the identities of property owners and use them to create fake title deeds, which they then use to sell the land without the consent of the actual property owners. Once the transaction is completed, the fraudulent seller will disappear, leaving the unsuspecting buyer to confront the true property owner when the scam is eventually exposed.

2.   Hurried sales

Unscrupulous developers and project marketers may attempt to rush potential buyers into making decisions by creating false excitement and the illusion of scarce availability. The fear of missing out can lead buyers to make hasty decisions without conducting proper research. In these scenarios, buyers are not given the chance to investigate the property and their questions go unanswered. It is only after the transaction is completed that the buyer realizes they have been duped into a poor deal.

Read Also: Rental scams and how to avoid them as a renter

3.   False promises

In an effort to gain an edge in a highly competitive market, some property developers in Kenya have been making false claims to attract potential buyers. They advertise false features and amenities such as swimming pools and sports areas but fail to deliver on these promises, citing technicalities and lack of approval. Additionally, it is common for builders to deviate from the original plans. Buyers who are dissatisfied with these changes often find themselves unable to take legal action as many contracts include clauses stating that “layouts and images are for visual representation only and are subject to change.”

4. Deliberate delays

Fraudulent real estate agents in Kenya have become adept at causing project delays. They often launch and promote large projects without sufficient funding for construction, waiting until they have a certain number of buyers in the early stages of the project to secure financing. This delay often causes inconvenience to buyers who have taken out bank loans and were expecting to move out of rented properties within a specific timeframe. In some cases, the developers will shut down their company and disappear with the money collected from investors, leaving them with only purchase agreements and large loans to repay.

There are several ways through which you can avoid being scammed. These are; –

1. Take your time

It is important to have a clear idea of what you are looking for and your budget from the beginning. Real estate agents will hype their property for all kinds of reasons, using the most convincing methods.

2. Be Careful with Impersonators

A common scam reported is when fraudsters impersonate the true owner, agent or developer of a property. They may present fake contracts, offer payment options such as Paybill numbers and bank accounts, and provide other false documents.

3. Don’t fall for exaggerated prices.

The desire for cheaper things is common to us all and not only Kenyans. Scammers are aware of this and may lower prices and use fake photos to lure potential victims. To protect yourself, it is important to conduct your own market research, familiarize yourself with the prices in the area, and seek additional information before making a decision.

Read also: rental scams and how to avoid them as a landlord

4. Early booking deposit? Think Twice

Do not let high-quality images of a property convince you to make a deposit before seeing it in person and meeting the owner or manager. Do not make any payments until after a contract has been signed and you have personally viewed the property.

5. Site visit

It is crucial to always visit a property in person before making a decision, regardless of whether it is a piece of land, a house under construction, a completed house, or an off-plan apartment. It’s also advisable to visit the site without the seller’s presence and speak with the neighbors, as this may reveal issues the seller is not willing to disclose. It’s important to note that you should never pay to visit the site, any request for payment should be considered a red flag.

6. Due diligence

It is important to have all relevant documents reviewed by experts. It is recommended to hire a lawyer to conduct a search to ensure the property does not have any legal encumbrances. This step may require an investment of money but will safeguard your interests in the long run. Before proceeding with the transaction, it’s important to verify that the property is not located on a road reserve or stolen land and that the developer has obtained all necessary government approvals. Additionally, you should confirm that the owner has paid all applicable land levies.

7. Check the developer’s background

It is important to conduct a thorough investigation into the developer’s trustworthiness. Do not solely rely on their claims, instead, check out social media and other digital platforms for any testimonials or complaints about the developer. Inspecting their previous or ongoing projects can also provide useful insight. Additionally, it’s important to review the financial model of the project. If the developer is using funds collected from buyers to finance the construction, it is likely the project may stall at some point.

8. Get a valuer

If you are uncertain about the pricing of a property, consider obtaining a professional valuation. A valuer from a bank can also assist in verifying the property’s value if you are planning to take a mortgage.

9. Read the fine print

Before finalizing the transaction, establish a written agreement with the seller on the payment terms. Have your lawyer review the documentation and provide guidance on the next steps.

10. Delay clauses

It is important to include a clause addressing delays and a detailed construction timeline in the contract to protect yourself from any intentional delays by the developer. Once the transaction is completed, be sure to retain all documents generated during the process, such as legal documents, sale agreements, mortgage agreements, lease agreements, and so on.


By following the tips mentioned above, you can protect yourself from real estate scams and enjoy the benefits of investing in the industry. Don’t let yourself become a victim of real estate scams in Kenya.

Share your experiences and help others avoid falling prey to these fraudulent schemes. We would love to hear about any scams you have encountered in the market, as well as your thoughts on this topic. Leave a comment below and let’s work together to protect others and ourselves from these unscrupulous individuals/ companies

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