Purchasing an immovable property is a process which requires careful handling by the purchaser, in order to avoid any unpleasant situations. Here is some basic information one should know before beginning the process.
There are three ways to purchase immovable property: with immediate transfer of a certificate of registration (title deed), through a sale contract (SLC), or from a current purchaser (not an owner) through assignment of a sale contract.
In the process of selecting the right property, the interested purchaser should look into all the rights and restrictions related to the property in question. The more information the prospective purchaser has at their disposal, the better decision they will be able to make.
The certificate of registration of the property should be requested. Having a title deed for the immovable property ensures its registration in the land register of the Department of Lands and Surveys (DLS). For complete information, a recent certificate of registration should be requested from the seller, which contains important information regarding the type and current condition of the property.
In the absence of registration, the interested purchaser needs to investigate further and possibly seek the advice of a real estate expert.
Ask the seller to provide you with a search certificate of the property. Search for all the characteristics of the property you are interested in on the Department of Lands and Surveys Web portal (DLS Portal). The characteristics of all properties are available to the public free of charge. Moreover, at the DLS Portal you can find a video explaining how to search for them.
Make sure you find out the following:
- Whether the immovable property is registered and whether it really belongs to the seller
- The registered area of the property
- If there are any encumbrances, such as a mortgage, memo (an encumbrance created after the registration of a court decision), court decision to sell the property, any other deposited sale contract and anything else affecting the property
- If there are any personal prohibitions against the registered owner, such as an order of bankruptcy or dissolution of a company, an order prohibiting the owner from selling the property and so on
- If there is legal access to the property or if it is enclaved
- Whether any public stream, pathway or river passes through it
- If the property is affected by compulsory acquisition
- From the relevant planning authorities whether the property is affected by any development, such as a new road
- If there are any other notes, or commitments, or restrictions on the property
- If there have been any interventions by third parties, by local inspection of the property
- If the registered area of the property corresponds to its actual area
- The town planning characteristics of the property, so that you know the development and use rights of the property.
Regarding the purchase transaction, make sure you know whether it is subject to value added tax (VAT). Ask the seller whether VAT should be paid and at which rate. The seller should know in advance, after consultation with the tax department whether the sale property is subject to VAT.
Make sure you know the amount of transfer fees you as a purchaser will have to pay to the DLS when the property is transferred to your name.