The restructuring of land information management being undertaken by Uganda’s land registry has bogged down transactions and delayed transfers of subdivided titles to buyers of small plots located in large residential estates.

Industry sources say there have been delays in the subdivision of plots on housing estates of more than 100 acres due to a shortage of survey data in the land registry and high levels of fraud.

The plots, varying between 50 by 100 feet and 100 by 100 feet, cost between Ush4million and Ush20 million ($1,092 and $5,461), market data shows. The plots are targeted at young middle-class families of fewer than five people, modest incomes and a desire for more organised residential zones.

Real estate dealers claim that applications for plots in Mukono district, about 23km from Kampala, take about one month to be approved at the land registry, but those from neighbouring districts like Wakiso and Luweero take more than three months.

Reports of fraud involving large, empty plots belonging to absentee landlords, mainly in Wakiso district, have led to suspicions about land transactions in this area and in turn, led to more scrutiny from registry officials. Kampala, Wakiso and Mukono districts account for about 70 per cent of all land transactions in Uganda, according to real estate experts.

Data shortage

“Shortage of data on some districts has affected approvals of subdivided land titles at the registry since the restructuring process commenced a few years ago. For example, applications for subdividing land titles from Mukono district are usually approved after one month because of sufficient land data available at the registry, while those from Wakiso and Luweero districts take much longer due to inadequate data.

“Besides that, the Lands Ministry and registry tend to deploy different teams of valuers on large pieces of land located upcountry and this breeds confusion among buyers. The restructuring process at the land registry should be focused on cleaning up the system and not changing top leadership if it is to succeed,” said Sam Wabasa, the chief executive officer of Canaan Sites Ltd, a real estate company that sells plots and builds homes in large residential estates.

Canaan owns a 400-acre housing estate in the Gayaza area of Wakiso district, among other properties.

The reforms being undertaken in the land registry include computerisation of titles; conversion of title deeds from paper to electronic form, resurveying of all districts, creation of a digital database under the Land Information System and elimination of multiple land titles — a  common fraud tool used to con unsuspecting buyers. The reforms started in 2012 and are funded by the World Bank.

The Bank provided a loan of $100 million in 2013 meant to finance the Competitiveness and Enterprise Development Project — a reform tool aimed at execution of land management reforms, boosting tourism and export growth.

Under the first phase of the project, land records for Kampala, Wakiso and Masaka districts were digitised, while other districts have been lined up for phase two. IGN France International, a French company, was contracted by the Private Sector Foundation Uganda, on behalf of the World Bank, to implement the project over a three-year period.

Shady land brokers

Persistent corruption witnessed at the land registry also poses a stumbling block towards reduction of the cost of doing business in the country’s land sector.

“A land title search costs Ush12,000 ($3.3) at the land office and takes up to six months. But if you pay Ush100,000 ($27), you get results in less than one day. In Wakiso district, high levels of fraud have affected the process of transferring land titles to new owners.

“There is a group of shady land brokers based at the district headquarters that specialises in looking around for empty land belonging to other people. They connive with some people at the district lands office and registry to transfer people’s titles secretly before selling the land to unsuspecting buyers.

“I nearly lost eight acres of land that I inherited from my father, and efforts to recover it from unscrupulous persons are yet to pay off after spending millions of shillings pursuing the matter inside and outside court. While the computerisation process of the land registry and physical remapping are good for the industry, the integrity of the data being used is questionable,” said Stephen Semaganda, a property valuer.

Lands Ministry officials blame shortage of money for the slow restructuring process at the registry. But a committee appointed by President Yoweri Museveni last month to probe the matter, could shed light on the rot in the sector.

“It is true these problems exist, but this is expected in bureaucratic institutions. There are ready plans for full geographical remapping of Uganda, but lack of funds is the biggest problem for us.

“Rwanda has invested $60 million in land management reforms, but is now struggling to maintain its registry operations. Each parcel of rural land costs $8-$10 in titling charges, while urban parcels cost $10-$12 each.

“Uganda is targeting 20 million land titles, compared with Rwanda’s 11 million titles, and this effort will cost us around $400 million,” said Richard Oput, a senior official at the Ministry of Lands, Housing and Urban Development.

Meanwhile, commercial banks have partnered with the large housing estate developers.

Canaan Sites has partnered with Housing Finance Bank, Uganda’s oldest mortgage lender, to provide property loans at favourable terms. Beneficiaries are entitled to mortgage interest rates of 17.5 per cent per annum, a loan duration of 20 years, and an equity contribution of about 20 per cent tied to the mortgage facility.

“This deal will help us to tap into new housing market growth areas. Canaan Sites has ventured into the Gayaza area, and our partnership with them will enable us to penetrate that segment and grow our market share.

“In the past, National Housing and Construction Corporation’s investment in the Naalya area helped open up neighbouring areas like Sonde, Kyaliwajjala and Namugongo through laying critical infrastructure like roads, electricity and water connections, and this boosted the development of the Northern Kampala Zone,” said Mathias Katamba, the managing director of Housing Finance Bank.