The Need to Develop a Consumer Code for Property Builders in Kenya

Article 46 (1) (c) of the Constitution of Kenya, 2010 guarantees consumers to the right to protection of their economic interest.

This protection ought to be availed to the consumers of real estate in Kenya with particular focus to off-plan purchasers who in essence are purchasing an idea/architectural plan.

The real estate trend in Kenya has in the recent past developed to embrace off-plan purchases with more Kenyans embracing this type of purchases for its benefits including:

  1. Potential high savings;
  2. Flexible payment plans; and
  3. Ability to resell at a profit before completion.

The risks that come with off plan purchases such as delayed completion period, poor finishes and undelivered promise/projects by unethical developers cannot be ignored. It is on this basis that the stakeholders in the real estate industry need to consider a consumer code in order to boost confidence in off plan purchases.

The United Kingdom applies the Consumer Code for Home Builders that sets mandatory requirements that all home builders must meet in their marketing and selling, after sales as well as customer service.

Some of the provisions under the said Consumer Code which are intended to protect the purchasers include:

  1. Mandatory compliance of the Code by home builders;
  2. Diligence customer service by the Home builders;
  3. Accurate and truthful sales and advertising;
  4. Provision of adequate pre-purchase information;
  5. Reliable and realistic timing of construction, completion and handover of the project;
  6. Complaints and dispute handling;
  7. Contract termination rights; and
  8. Establishment of Independent Dispute Resolution Scheme.

Developing a Consumer code for Property Builders will improve consumer confidence and consequently lead to an uptake of real estate products as the purchasers are better guaranteed of their investments whilst the unethical developers are locked out.

For more information regarding real estate investment, kindly contact us at info@cfllegal.com

Authors: Emma Kyalo

                 Roselyne Muyaga