The Dirty Secret of 'Off-Plan' Property Deals in Uganda (And How to Not Get Burned)

Buying "off-plan" – purchasing a property before it's constructed, often at a discount – is becoming popular in Kampala. While it can be a great investment, it carries significant risks if you're not careful. Here’s how to protect yourself.

The Alluring Promise and The Hidden Dangers

The promise is simple: buy early, get a lower price, and watch your property's value increase by the time it's finished. The danger? The project stalls, the developer uses substandard materials, or in the worst cases, the developer disappears with your money.

Your Due Diligence Checklist

Before signing any off-plan agreement or paying a deposit, you MUST do the following:

• Verify the Developer's Track Record: Don't just look at their flashy brochures. Go and see their previously completed projects. Are they of good quality? Are the residents happy?
• Confirm Land Ownership: The developer must have a legitimate, unencumbered title to the land the project is on. Ask for a copy of the land title and conduct your own search at the land registry.
• Scrutinize the Building Plans and Permits: The project must have approved architectural and structural plans from the KCCA. Ask to see the stamped, approved plans and the building permit.
• Understand the Contract: Have a lawyer review the purchase agreement. Pay close attention to the construction timelines, payment schedule, material specifications, and penalties for delays.
• Escrow Accounts: The safest way to pay is through an escrow account, where your money is held by a neutral third party (like a bank) and released to the developer only when specific construction milestones are met and verified. Be very wary of developers demanding large direct cash deposits.

An off-plan investment can be successful, but only with extreme caution. A reputable developer will be transparent and welcome your questions. If they are evasive, walk away.