Although the process of buying and selling property in Jamaica is relatively straightforward, it does involve a complex series of steps.
Steps involved
Upon identifying the property, an offer is made to the seller. If the offer is accepted, the seller will draft an Agreement for Sale, which will detail the terms of the transaction. This will include an accurate description of the land, the purchase price, and the completion timeline.
Additionally, the Agreement should specify whether the purchaser is financing the acquisition through cash or a mortgage, whether the property will be vacant or occupied upon transfer, and encompass other pertinent details.
The purchaser should subsequently review the contract and perform due diligence at the Titles Office to verify that the title for the land is registered in the seller's name.
After finalizing terms, the Agreement is signed and a 10% deposit is paid, making the contract binding.
The purchaser should subsequently conduct further due diligence on the property. For example, obtaining a surveyor's identification report is essential to confirm that there are no issues with the property, such as violations of restrictive covenants or boundary discrepancies.
The seller is required to submit the signed contract to the Tax Administration of Jamaica, pay the applicable fees, and subsequently submit the documents to the National Land Agency for the transfer of the land title to the purchaser.
Upon completion of the purchase, and sometimes before, the buyer will take possession of the property. At this point, the buyer will transfer the property tax and utility bills into their name and will be responsible for these expenses as well as the property itself.
Hidden costs no one talks about.
Many people think buying a property only involves finding the deposit, but there's much more to it.
Expenses to consider include:
1. Sale agreement cost – the fee for preparing the contract, typically split equally between seller and buyer.
2. Costs of letter of possession – this fee covers the preparation of letters to utility companies and is shared equally by both parties.
3. Legal fees- each party should pay their own fees
4. Stamp duty and registration fees- are shared equally and paid to the government to transfer the property to the purchaser.
5. Processing fees are charges imposed by banks or the National Housing Trust (NHT) when a purchaser is obtaining a mortgage. These costs are solely the responsibility of the purchaser. Each mortgage institution has its own processing fee.
6. Surveyors ID Report – done at the cost of the purchaser, to check for violations of restrictive covenants or boundary discrepancies.
7. Valuation Report – conducted at purchaser's expense but can be done by the vendor to determine fair market value.
8. Structural Engineering Report - Based on the property's age or condition, a purchaser might require a Structural Engineer Report, especially if obtaining a mortgage.
9. Transfer Tax - paid to the government and is borne by the seller only.
For more information or an estimate, please feel free to contact us.