Returning Residents & Home ownership
If you are living in the Diaspora and are thinking of returning home, we urge you to engage the services of professionals who can provide you with the proper guidance re your pending move. As a Returning Resident you should be on your guard and avoid questionable consultants. We encourage you to check with a local Returning Residents’ Association for a list of accredited financial consultants and financial institutions to assist you with your move.
If your intention is to acquire real estate or build your dream home over a period, you should ensure that payments are made promptly, as the vendor has the right to cancel the purchase agreement. It would be wiser to secure financing from a licenced financial institution to help with the prompt payment to the vendor. Please contact the VMBS Representative Office nearest to you if you wish to access a mortgage loan to make your purchase or review property listings through Victoria Mutual Property Services. Contact us Today!
Guidelines for Government Owned Property Acquisition:
- It is advisable to consult an Attorney to obtain legal advice in relation to property acquisition.
- If you are seeking to acquire land owned by the Government of Jamaica, you should first submit an application to the relevant State Agency that owns the land.
- You may offer terms for the acquisition of such land, but the Government Agency reserves the right to impose its own guidelines for the disposal of land.
- Any accessing of land involves legal formalities, which includes negotiation and preparation of various documents. These will invariably add to the total cost of acquiring property. There are standard fees paid to Government agencies and the Jamaican Bar Association provides a recommended scale of legal charges for the transfer of property from one owner to another. All these charges bear a direct relation to the cost or value of the land involved.
Precautionary Steps to be considered before entering a Lease Agreement
- If the transaction undertaken is a lease agreement, then the lessee should ensure that the leased property is officially registered on title.
- This will incur costs for registration, stamp duties and other legal fees, but it will give security of tenure, that if the original owner of the property sells it, that owner must sell with the lease agreement, so that the new owner must retain the leasee. The alternative, would be for the owner of the property to purchase the lease from the leasee. Please note, purchasers are advised to consult with an Attorney prior to entering into a Lease Agreement.
- Failure to have an official registration of the lease on the title of the property would mean that the new owner of the property might not be duty bound to respect the terms of the lease. A sale/lease agreement does not distinguish between house and land; it encompasses land whether or not a house is on such land.
If you choose to abort the sale
- If after seeking to purchase property you decide to abort such sale, you might still be obliged to pay legal expenses.
- All matters incidental and necessary for the transfer (such as a sub-division approval) are the responsibility of the vendor. The attorney’s cost for the preparation of the sale agreement, as well as the stamp and registration fees payable in respect of the transfer, may be borne equally by the vendor and the purchaser.
After the Sale Transferring the Property
- After the actual sale, a transfer has to be done to formally register the new owner of the property. Under this arrangement, the vendor’s attorney will prepare documents to begin the transfer process.
- All matters incidental and necessary for the transfer (such as a sub-division approval) are the responsibility of the vendor. The attorney’s cost for the preparation of the sale agreement, as well as the stamp and registration fees payable in respect of the transfer, are to be borne equally by the vendor and the purchaser.
Some Applicable Fees
- The Jamaican Bar Association recommends attorney fees, while stamp duties and registration fees are set by the state.
- In addition, the purchaser’s attorney will charge a separate fee for vetting and amending the transfer. (The vendor’s attorney will ensure that the transfer is stamped and lodged with the relevant Government agencies).
- Transfer is paid to the Commissioner of Transfer taxes and Registration Fees are paid to the Titles Office.
- While the stamp duty is to be deposited with the Stamp and Estates Duties Department.
- If the Government is the vendor, the buying process may be hastened considerably if the purchaser assumes some responsibility for any necessary subdivision. In certain cases when the Government is involved as a party, stamp duty may be waived and the norm is that the Government does not pay transfer tax.
Building versus Purchasing
- Most local realtors would recommend that returning residents purchase a house rather than acquire property to build one.
- Frequently, construction projects on the island are not completed on time. Invariably, it is the person(s) purchasing the home that bear(s) the bulk of the costs associated with production time overruns. The building route is particularly inadvisable if the construction is to commence while the owner is living overseas.
- It is best that the person building the house is present in the island to liaise with the professionals involved in the construction, and to be on site to ensure that production targets are met.
Other points to consider
- A false perception of the spending power of their resources is one of the biggest problems among returning residents. Oftentimes when they decide to resettle on the island, persons aim for the biggest and most fancy houses, which often carry costs way beyond their means.
- Returning residents should seek to know more about the prices of property in Jamaica.
- It is also wise to learn simple building terms.