Frequently Asked Questions
General Real estate Questions
Real estate is the land along with any permanent improvements attached to the land, whether natural or man-made—including water, trees, minerals, buildings, homes, fences, and bridges. Real estate is a form of real property management company. It differs from personal property, which are things not permanently attached to the land, such as vehicles, boats, jewelry, furniture, and farm equipment.
- Residential real estate: Any property used for residential purposes. Examples include single-family homes, condos, cooperatives, duplexes, townhouses, and multifamily residences with fewer than five individual units.
- Commercial real estate: Any property used exclusively for business purposes, such as apartment complexes, gas stations, grocery stores, hospitals, hotels, offices, parking facilities, restaurants, shopping centers, stores, and theaters.
- Industrial real estate: Any property used for manufacturing, production, distribution, storage, and research and development. Examples include factories, power plants, and warehouses.
- Land: Includes undeveloped property, vacant land, and agricultural land (farms, orchards, ranches, and timberland).
- Special purpose: Property used by the public, such as cemeteries, government buildings, libraries, parks, places of worship, and schools.
- Location
- Timing
- Circumstances
While location is a key factor, it takes timing and circumstances (i.e. a growing, booming economy and the need for more services for people in an area) to make it feasible to develop the property.
Questions about Land
- Understand the 4 different land ownership
There are four types of land in Ghana:
- Government land
- Vested land
- Customary/stool land
- Family/private land
- Most lands in Ghana are lease hold
- Foreigners can lease land for not more than 50 years
- You need to do your due diligence privately on land ownership before paying for the land
- After acquiring an indenture from the seller, you need to register your interest with Lands Commission.
Due to uncertainty in land ownership system in Ghana acquiring a land which is clean, free from litigation and other encumbrances, can be very daunting. It is therefore important for buyers and inverters to undertake proper due diligent to minimize the risk of entering into fraudulent transaction.
1. CHECK IDENTITY AND THE CREDIBILITY OF THE SELLER
2. CHECK THE LEGAL DOCUMENTS COVERING THE LAND
3. SEARCHES AT THE LANDS COMMISSION
4. SEARCHES AT COLLATERAL REGISTRY
5. SEARCHES AT THE COURT TO ASCERTAIN PENDING LITIGATION
6. SEARCHES AT THE NEIGHBOURHOOD
7. CONTRACT OF SALE
8. PREPARATION OF TRANSFER DOCUMENT OR ASSIGNMENT
9. REGISTRATION OF THE ASSIGNMENT OR SUBLEASE
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Indenture is a deed. Normally, real property transaction involves the sale of real property under contract and is usually consummated by the delivery of an indenture or deed. An indenture is a written instrument used to convey an interest in real property; thus an indenture or deed conveys legal title.
First, the potential purchaser must conduct a physical inspection of the land
Next, the purchaser must investigate the title of the seller to establish ownership of the property independently at the lands commission.
NB: If the property is outside a registration district, then the purchaser must trace the root of title of the vendor from the Deeds Registry to ascertain the right owner of the property.
In addition, the potential buyer must also conduct a search at the registry of the Law Court and the Traditional Council where the property is situated to ensure that there are no on-going disputes affecting the land
After lands are registered, it is possible to transfer them to others. A title or interest in real estate can be transferred from one person to another through the process of alienation. This can be done either voluntarily (that is, with the owner’s consent) or involuntarily. Voluntary transfer includes an indenture or deed by testament or will. A deed is a written instrument transferring an interest in real property to the grantee.
Eminent domain, which is also a form of voluntary transfer, is when the government takes over a property of land through a legal process for a specific purpose that is useful for the general public. Owners of such lands are duly compensated. Mostly, such lands are used in road construction or to provide utility services.
Involuntarily, land title can be transferred when the owner of the title dies or could not maintain possession of the title. This type of ownership is known as adverse possession.
These are the various ways that land titles can be transferred from one owner to the other in Ghana.
It takes between 6 months to a year to get title registration done in Ghana
Land in Ghana Appreciates quickly and one of the reasons for this is rapid urbanization of smaller communities and suburbs. When I started my real estate career in 2020, land in oyarifa a suburb in Accra was going for between GHS 60,000 to 80,000 per plot. Today January 2022, land in the same area is going for between GHS 100,000, to GHS 150,000. There is no mutual fund or treasury bill that can give you this kind of return in the same time period
Cost of title registration is dependent on the size and location of the land. Please visit The Ghana Lands commission website for more information.
THE DOCUMENT/INSTRUMENT BEING SUBMITTED FOR REGISTRATION MUST CLEARLY SHOW THE FOLLOWING:
- Stamped (Stamp Duty duly paid)
- Date of instrument
- Nature of Instrument (Title of document)
- Names and addresses of parties
- Signature of parties
- Names and addresses of witnesses
- Signature of witnesses
- Solicitor’s Stamp/Seal
- Approved plan ( Certified judgment plan if nature of instrument is Judgment)
- The following information on site plan must be the same in document:
- Name of owner
- Land size and location of land
- Licensed Surveyor’s and Director, Survey and Mapping Division’s signatures and date
- Back of the site plan must be signed by the parties
- Signature of witnesses of parties with addresses
- Jurat (if document is thumb printed, etc)
- Oath of Proof must be executed
- Deponent must be completed by grantor’s witness
- Planning Comments/Approval with extracts from layout from Town and Country Planning Department (Stool Lands Only)
- All supporting /recited documents must be attached
- Evidence of Concurrence/Consent (Stool and State Lands subsequent transactions)
- Original Land Certificate of transferor (For transfer of whole
Indenture is a deed.
Yes, a deed refers to a written document executed in accordance with law, wherein a person grants or conveys to another a certain land. A title, on the other hand, is the legal right to ownership of a property.
It depends on the seller of the Land. The cost of the land documentation includes surveyor fees and legal fees.
If you are non-Ghanaian or foreigner, you can not buy freehold land you have to lease it. Ghanaians are allowed to buy freehold land. However, it is unlikely to get freehold land these days.
Price of land depends on the Location of the land, Infrastructural development, nearness to the city centre or capital city and forces of supply and demand.
An acre is about equal to 43,560 square feet. A standard plot size in Ghana is 70 feet by 100 (7000 square feet) therefore there is roughly about 6 plots in an acre given the plot measurement.
Before purchasing land in Ghana, one must note the different types of land ownership in Ghana. Lands do not only belong to an individual, they differ depending on the original owners of the land you wish to acquire. There are:
- Stool or Customary Land
- Government or State Land
- Vested Land
- Family Land
- Private Land
There are some freehold options available but they are very few.
After the lease has expired, the land will technically revert back to the freehold interest owner unless the lease is renewed. This is the crux of the pitfall in the real estate industry. In the absence of codified traditional officers with the authority to alienate land, alienation of stool lands can be equated to navigating a sophisticated maze. A valid renewal of lease must be with the consent of the appropriate traditional officers. However at any point in time, there are numerous people within the traditional state who claim to have authority to alienate lands. It is therefore not uncommon to witness cases where a faction will institute an injunctive action against any such alienation until the question of who has authority has been settled.
Where the authority for the renewable of leases has been settled, there is also uncertainty as to terms of the renewal. Here, questions such as the duration of the new lease as well as the fee for the renewal of the lease then becomes very important. Where the occupier of the land has substantial interest in the land, in an open market the owners of the land may be incentivized to ask for an outrageous sum of money as consideration for the renewal of the lease. In such circumstance, although the occupier of the land can apply to the court to vary the terms of the new lease, the court action and its outcome then becomes a transaction cost and an uncertainty, respectively. The freehold interest holder may be tempted to hold out as against the lessee in anticipation of realizing substantial amount of money for the renewal of the lease. This is because under the current system, the freehold interest holder technically owns everything on the land including all structures thereon if the lease is determined. These issues are worrying for industry players such as the mortgage market, bankers, investors and also the individual house owner (sub lessee or assignee).
Where the remaining interest of the lease is equal or less than the duration of a standard mortgage, mortgage companies will certainly not be ready to fund such mortgages. This is because the mortgage company cannot plan with some certainty as to what will ensue when the lease comes up for renewal. In addition, until these issues are resolved, the mortgage companies will be forced to hold onto mortgages until they are redeemed although mortgage companies may be able to securitize mortgages and sell them as financial instruments to investors. The value of such securitized mortgages becomes difficult to determine because one cannot reasonably make assumptions as to the value of leases in the future.
However, statutory intervention in the industry will help tremendously to reduce the uncertainties and risks in the industry. First, a statute that offers guidelines or provides a framework for the calculation of leases where the original interest has been exhausted and the lessee has significant investment on the land will be useful to ensure that industry players can reasonably predict the value of such renewals. The statute must also provide that where the officers responsible for alienation of land is in dispute, the court must appoint a receiver and manager to work with the lessee to determine the terms of the lease and the price thereof based on the existing guidelines or framework. Any money realized will then be put in an escrow until a determination is made as to who should be entitled to the money.