How a repossession sale works
When a borrower defaults, the bank (the chargee) can exercise its statutory power of sale under the Land Act after serving the required notices. Sales are usually by public auction run by a licensed auctioneer and advertised in the national newspapers, or by private treaty where the bank negotiates directly with a buyer.
Where to find them
- Auction notices in the Daily Nation and The Standard.
- Banks’ own “properties for sale” pages.
- Licensed auctioneers’ websites and notice boards.
Typical auction terms
Terms vary, but buyers commonly pay a 25% deposit on the fall of the hammer and the balance within 30–90 days. If you fail to pay the balance, you can lose the deposit. That makes a mortgage risky unless you have pre-approval in hand.
Risks to check before you bid
- Occupants — the property may still be occupied, and getting vacant possession can take time.
- Court injunctions — the borrower may challenge the sale.
- Condition — you often cannot inspect inside; budget for repairs.
- Arrears — check for unpaid service charge and land rates.
Our advice
Have an advocate run a title search and check for court cases before auction day, and bid only up to a ceiling you have set in advance. If a distress deal seems too risky, a well-priced ready home may cost little more once repairs and delays are counted.
Frequently asked questions
Are repossessed houses cheaper in Kenya?
Often, yes — distress and auction sales can be 10–30% below market value. But the savings can disappear if the house needs repairs, has arrears, or the sale is challenged in court.
Can I use a mortgage to buy an auctioned house?
It is possible but difficult, because auctions usually require the balance within 30–90 days. You need full mortgage pre-approval before the auction.
This guide is general information, not legal or financial advice. Fees, taxes and rules change — confirm current figures with a licensed advocate, your bank or KRA before you commit.
