Buying Landed Property in Ghana – Frequently Encountered Issues
I presented a paper at a Property Seminar organised by Legacy&Legacy at the La Palm Royal Hotel on 28th April 2007. These are my notes; probably a rough-and-ready checklist for land transactions in Ghana.
Freehold
o Highest interest in land
o Indefinite period
o Devolution ad infinitum, except upon a failure of successors
o Constitutional bar on granting freehold over stool lands
o Constitutional bar on granting freehold to non-Ghanaians
o Overall gradual shift from freehold to leasehold, especially in urban areas
Leasehold
o Interest granted for a specified period
o Especially in the case of Government lands
o Constitutional bar on granting leasehold exceeding 50 years to non-Ghanaians
o Most leases are renewable
Procedure for purchase
o Identify the land
o Preliminary physical inspection
o Take copies of vendor’s title deed and filed site plan
o Searches at relevant land registries
o Other inquiries as to ownership/availability, e.g. make inquiries in the area, if property owned by company – registered encumbrances (with Registrar-General’s department)
o Consents
o Drafting of transfer document
o Payment of final purchase price and execution of transfer document
o Stamping and registration
o Additional inquiries in respect of buildings:
Proper building permits
Compliance with zoning and planning regulations
Structural defects
Closing & Thereafter
o Possession/occupation
o Complete the contract (signing, witnessing, oath of proof and oath of execution)
o Pay the balance of the agreed consideration, if any
o Pay stamp duty (within 2 months or you pay a penalty)
o Registration with Land Title Registry (registrable areas) or Deeds Registry (yet-to-be-declared registrable areas). Might involve the re-drawing of the site plan as part of plotting.
o Capital Gains Tax – Vendor
o Gift Tax by the beneficiary, if the land was gifted
o Annual property rates (levied on buildings)
o Annual ground rent, subject to the contractual terms (levied on land generally)
o Note renewal terms, if any, with respect to leaseholds.
CHECKLIST
(1) Visual inspection
(2) Title documents: title deed, site plan, land title certificate, etc.: a. Does the grantor have capacity? (i. Government – acts by Lands Commission ii. Stool – Head of Stool with concurrence of elders, Lands Commission and the Office of Stool Lands Administrator iii. Family – Head of Family acting with consent of principal members); b. Signatures/Thumbprints (i. Grantor/Lessor, ii. Grantee/Lessee , iii. Concurring signatories); c. Consideration (How much? Mode of payment?)
(3) Description: a. Street name and number, b. Plot number, c. Particular description/designation, e.g. Joey Villa
(4) Type of Use: a. Residential, b. Commercial, c. Mixed Use, d. Compliance with planning and zoning permission, and e. Home Improvement – have the necessary permits been secured?
(5) Type of Interest: a. Freehold, b. Leasehold, c. Others (e.g. licence)
(6) Searches: a. Land Title Registry, b. Deeds Registry/Lands Commission
(7) Stamping: a. LVB number, b. Adequacy of stamping,
(8) Registration: a. Presentation & Plotting, b. Deeds Registry number, c. Land Title Registry number
(9) Covenants in Leases: a. User and other restrictive covenants, b. Overriding interests – rights of way, natural rights of water, easements
(10) Consents: a. Lands Commission – Government and stool lands, b. Minister for Lands & Forestry via Administrator of Stool Lands
(11) Litigation status: a. Courts, b. Traditional authorities
(12) Property tax payments: check with the relevant Metropolitan/Muncipal/District Assembly
(13) Home Improvements: a. Construction/alteration permits, b. Approved site plans – approval letter and date, c. Compliance with zoning and planning laws – Town & Country Planning Departments, d. Compliance with regulations of central and local government authorities, e. Structural report by Building Inspector/Engineer