As MP West Budama North MP Richard Okoth Othieno tabled a bill seeking to regulate real estate agents, Lack of Professionalism and Professional standards will slowly kill the real estate industry in Uganda.
Parliament then, waived a requirement for a mandatory certificate of financial implication, to allow West Budama North MP Richard Okoth Othieno to present his private member’s Bill entitled -the Real Estate Agents Bill, 2020.
The move followed a statement by MP Othieno in which he blamed the Ministry of Finance for failing to avail the certificate as required under section 76 (1) of the Public Finance Management Act (PFMA), 2015 despite his request dated 23rd September, 2020.
Like it has recently been witnessed in the media, a number of Embassies and Expatriates in Uganda have become victims of the predatory practices of numerous and scrupulous real estate agents in Kampala. This comes at a time when Kampala has seen a boom in the real estate industry, which in turn has led to an increase in the number of people who have suddenly become real estate agents, since there seems to be no regulatory authority to ensure standards among real estate agents.
As a result many clients have been conned and many have faced extortions, as the recent case of purchase of a property by the Embassy of Equatorial Guinea in Uganda. According to our highly placed sources, the Equatorial Guinea Embassy in Uganda in search for property, it purported that it was approached by a number of real estate agents, but unfortunately came across two individuals namely; Mr. Edward Katende and Mr. Brian Inholo who led them to Mr. Kananathan Veluppillai’s house in Kololo. The Embassy accordingly decided to buy the house and paid the full amount to Mr. Kananathan. However, to the Embassy’s surprise, the real estate agents demanded a finder’s fee of $85.000 which the Embassy declined to pay as this was not agreed upon in the first place. The agents further demanded $ 50.000 as commission.
Sources reveal that the agents secretly approached the Ministry of Foreign Affairs (MoFA) requesting for its intervention, which in turn called Mr. Kananathan and inquired why he wasn’t fulfilling his obligation with the agents. However, Kananathan responded and said that he had no prior agreement with the agents on paying them commission, although he was willing to pay them but the money asked was too much. According to the some documents seen by our highly placed sources, Kananathan had offered the agents a reasonable offer which they declined.
On its part, the Embassy stated that it never had an agreement nor agreed with the brokers such an exorbitant amount of money. It insisted that the commission is paid by the seller of the property. It is reported that MoFA urged Kananathan to work out an amicable settlement with the agents which later resulted into payment of 50 Million Ugx to the agents.
However, it is worth noting that, the agents had also come out with wild allegations against the Embassy of Equatorial Guinea in Uganda and MoFA officials, which they later withdrew after being presented with facts by MoFA and the Embassy.
Therefore, unless the Government and other relevant professional bodies come up with a regulatory framework of the real estate industry, it will continue being dominated by unprofessional real estate agents and other players who operate without any code of conduct and guidelines and hence engaging in extortion practices and tarnishing peoples reputation as with the case of the Embassy of Equatorial Guinea in Uganda and officials from the Ministry of Foreign Affairs.