UGANDA, Kampala | Real Muloodi News | Buying a piece of land can be an exciting venture, but before you sign any agreement, there are several things to consider to ensure you are making a sound investment.
Real estate managers suggest that while the plot of land may seem perfect, there is a lot you should know before purchasing it.
Here are some important factors to consider before buying land.
Type of Tenure
According to Denis Obbo, the spokesperson at the Ministry of Lands, Housing and Urban Development, Uganda has four types of land tenure as defined in the constitution.
These include freehold tenure, leasehold tenure, customary tenure, and mailo land tenure. It is important to have a good understanding of these tenures and their implications before purchasing land under any of them.
Freehold tenure is a type of tenure that grants the owner perpetual ownership of registered land and is free to sell or pass on their rights to their heirs.
Only citizens of Uganda are entitled to own land under freehold tenure, with non-citizens allowed only the alternative of leasing it for a period of up to 99 years.
Obtaining certificates of title under this tenure is pursued directly through government authorities.
Mailo tenure is predominant in Buganda. Mailo tenure grants permanent ownership of a large plot of land to landlords who acquired it through the 1900 Buganda agreement.
There are two kinds of mailo tenure; private mailo, and official mailo, aka Kabaka’s land. Official mailo consisted of land allocated to the Kabaka (350 square miles) and the ssaza chiefs (eight square miles), among others.
Today, the Buganda Land Board manages the 350 square miles of official mailo land, which is mainly located in suburbs such as Nansana, Munyonyo, Buziga, Konge, Kigo, Maganjo, Kagoma, and Ganda.
It is not possible to purchase and own the Kabaka’s land, as only leases are granted on this land. Private mailo land, on the other hand, offers the option of obtaining either a leasehold title or an outright transfer of ownership.
Private mailo owners therefore have perpetual ownership and can sell or pass their rights on to their heirs, just as with freehold tenure. However, there is one important distinction; with private mailo tenure, tenants on the land (known as bijanja in plural, or kibanja singular) are also legally recognised and have rights to live on and utilise the land.
Bijanja ownership is evidenced by a certificate of occupancy, which can bought or sold, or used to acquire loans from financial institutions. Bijanja holders will also pay ground rent (busulu) to their mailo landlord.
The amount of ground rent paid is determined by the District Land Boards, as per the Annual Nominal Ground Rent Regulations 2011 issued by the Minister of Lands Housing & Urban Development.
Mr Yusuf Nsibambi, a lawyer whose speciality is land law, further explains that bibanja holders’ rights to private mailo land are exclusive, and this exclusivity is not time-bound.
He further explains that bijanja holders cannot be evicted from private mailo land without a court order.
This has been reiterated by Mr Sam Mayanja, the State Minister of Lands, who has made clear “that unless the kibanja holder has agreed with the mailo landlord to compensation or buy him/herself, there is no law that allows the landlord to forcibly evict the bibanja holders.”
Consequently, before buying private mailo land, it is important to understand whether there are bijanja holders already occupying it.
If you wish to utilise the land yourself, you will need to adequately compensate your bijanja holders and follow the proper legal processes to evict them.
Mr Obbo says that when purchasing private mailo land, both the applicant and the transferring landowner fill out application forms to transfer ownership with the zonal office of the Ministry of Lands in their area.
Official mailo land is owned by the Kabaka by virtue of his position. The sale of Kabaka’s land is prohibited because it benefits the Kabaka’s office, Katikkiro, Ssaza, and Gombolola Chiefs.
However, you can obtain a leasehold title on Kabaka’s land.
According to LUBA Properties, one must pay both a premium and an annual ground rent when leasing Kabaka’s land. The premium is 10% of the land’s capital value, while the ground rent is 1% of the premium.
For example, if a plot of land in Buziga costs USh 40 million, the premium would be USh 4 million, and the annual ground rent would be USh 400,000. These payments of the premium is made once, and the ground rent is annually over the 49-year lease period.
Once the lease period expires, the land reverts to Kabaka’s ownership. The Kabaka’s office determines whether to extend the lease, but the policy of the Buganda Land Board is to renew leases and give them to the sitting tenant.
Customary tenure is mainly held outside of Buganda, and land is owned communally by a clan, tribe, or other groups. The Land Act of the Constitution describes this tenure as one where land is owned communally, by a clan, or a tribe, among others.
Obtaining a private certificate of title is possible for individuals, whereby they simply have to agree with the community that owns the land (the clan or tribal chiefs), then the Sub-county and government land boards take up the process of issuing the title.
The 1995 Constitution of Uganda and the Land Act, Cap 227 also allow for the conversion of customary tenure to freehold tenure.
Leasehold tenure grants the right to exclusive possession of land for a specified period, usually in exchange for the payment of ground rent. This type of tenure is usually granted by a landowner (whether through freehold, Mailo or customary tenure) to another person.
Much of the land that is leased is owned by government bodies such as the Kampala Capital City Authority, and it often comes with some development conditions imposed on the land’s subsequent use by those to whom it is leased.
Therefore, if you are considering acquiring a leasehold title, it is important to know how many years are left on the lease, and what development conditions may apply to it.
How to Verify a Title
According to Muhammed Kizito, a real estate manager, it is important to request and verify the titles of a piece of land before signing any agreement. You can carry out a title search at the Ministry of Lands zonal office.
You can also conduct online searches through the National Land Information System (NLIS) public portal, after payment of a ten thousand shillings fee for each search. You can access the portal here: https://www.ugnlis.mlhud.go.ug/ You will need to know the following to perform your search:
- For Mailo: County, Block & Plot no
- For Leasehold: Leasehold Register Volume & Folio No
- For Freehold: Freehold Register Volume & Folio No
Road Access
Fred Nyanzi, a physical planner at Buganda Land Board, advises real estate buyers to only invest in land that has road access. He says having an access road is essential for the development and sale of a property.
Nyanzi explains that there are two main ways to access a property and these include a front road, which is a local road that provides access to private properties, and a deeded road which is a formalized two-way agreement between the neighbours.
Deeded road access involves a written agreement with neighbouring landowners, allowing you to use the road to access your own land. This agreement must be signed by all parties and noted on their titles for legal purposes as a right of way.
Nyanzi says land with deeded access is usually not a problem for potential buyers, but one should still consult the neighbours.
“If your property is accessed by a deeded access road, you need to find sit down with the neighbours and find out as soon as possible what the agreement is,” Nyanzi says.
On the other hand, Nyanzi warns that many properties do not have formal access roads, and require crossing over someone else’s property to gain access.
“Many people believe an access road is automatically provided to every piece of land, but this cannot be farther from the truth. Many properties are do not have access roads and they are technically classified as landlocked”, he says.
In some cases, neighbours may allow access through their land through an informal or ‘gentleman’s agreement’ – otherwise known as un-deeded access.
However, this arrangement carries risks and can be revoked at any time. For example, if your neighbour were to pass away, sell their property, or change their mind due to a misunderstanding, you could lose your access.
According to Nyanzi, landlocked properties have several limitations. For example, landowners cannot legally subdivide their land or develop it because local governments will not approve plans without an access road. This can also limit transactions on the property, mainly because land management organisations such as Buganda Land Board consider these restrictions when making decisions.
Additionally, lenders are less likely to provide capital for development, and utility companies (such as water and electricity) will not be able to connect the property to their networks.
Without a formal access road, it may be challenging to sell the land to anyone other than a neighbour, and therefore the value of the property may decrease significantly compared to surrounding land.
Restrictions
Judy Rugasira Kyanda, a chartered surveyor and managing director of Knight Frank Uganda, one of Uganda’s leading property consultancy firms, says it is important to also do your due diligence to understand what you can build on a plot of land, and what restrictions may apply to it. For example, there may be height restrictions, or other restrictions may apply if it is a wetland.
Also, you may need to fulfil specific planning requirements before you build on it, such as soil tests etc.
Judy says you should also check if there are any easements on the land, meaning the legal right of a second party to cross or make limited use of the land (such as deeded road access crossing your plot).
You are not permitted to build on or obstruct any such easements.
All of this is critical, and some of this may differ with the different land tenure systems. Therefore Judy recommends going to your town planning office, going to your district or city council and local planner to find out what you are permissible for you to build there, and the requirements.
Boundaries
Additionally, it is important to clarify the land’s boundaries as building or planting on land that is not yours could result in lawsuits.
Therefore, it is advisable to ask whether a recent survey of the land has been done to provide clear and up-to-date boundaries for the land. Otherwise, you should contact your own surveyor to open boundaries.
Access to Utilities.
Moreover, access to necessities such as electricity is another aspect that should not be overlooked.
According to Mr. Kizito, just because the land has access to a power line does not mean you can use it. Therefore, it is important to verify whether you have the right to use the power line or not.
You can apply to UMEME for an inspection, for a fee of USh 41,300. Here is UMEME’s full set of charges: https://www.umeme.co.ug/what-you-need-to-get-connected
Real Estates
According to Frank Mugalu, a property manager, for those buying land from a real estate agent, it is crucial to be observant as once the agreement is made, it is difficult to make amendments.
It is essential to know what is happening with the other properties near the land. Knowing whether properties near you are in the process of development or have had any environmental issues can help you anticipate what to expect from your land.
“Are properties near you in the process of development? Have there been environmental issues or hazards with your neighbours? Then this will help you get an idea of what to expect from your own land,” Mugalu says.
Additionally, it is important to consider the land location as having a residence in an industrial area or near a school may not be ideal due to the noise.
Before buying land, it is essential to conduct due diligence and obtain relevant information.
ADVERTISEMENT:
READ MORE LIKE THIS:
