Advice for Returning Residents

Jamaicans who migrate to North America and the United Kingdom in particular, seem to know when it is time to head back home. However, quite often when such persons make that critical decision, they follow it up with inadvisable practices and reliance on non-professionals.

The following outlines a number of property-related steps advisable for those desirable of coming 'back a yard'.

• If you are seeking to acquire land owned by the Government, you should first submit an application to the relevant state agency that owns the land.
• One 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. These will invariably escalate 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.

The legal formalities also always involve negotiation and preparation of various documents. You should therefore get your attorney to write to inform you of the various stages to be covered in an effort to close the transaction.

• Two of the common documents needed for land acquisition are: the sale agreement and the transfer, or in the case of lease or rental - a lease or rent 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 lessee. The alternative for the owner of the property is to purchase the lease from the lessee.

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.

Once the land has been identified for sale, the vendor's attorney will prepare a sale agreement. The cost of the preparation of this agreement is paid on the signing of the agreement. The purchaser should engage his/her own attorney to vet and amend the agreement.

If after seeking to purchase property one decides to abort such sale, one might still be obliged to pay legal expenses. If the sale agreement had been stamped, it is the norm that the stamped sale agreement is returned to the parties for them to recover the money that was paid to get the agreement stamped. Normally, both parties will split these legal fees in half between themselves.

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.

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. The transfer tax and the registration fee are to be deposited with the Titles Office while the stamp duty is to be deposited with the Stamp and Estates Duties Department. A transfer tax is payable whenever a title is being transferred to a new owner. The payment of this tax is the responsibility of the vendor.

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 Government is involved as a party, stamp duty may be waived and the norm is that the Government does not pay transfer tax.

If you are residing outside of Jamaica and are unable to fly to the island to look at the property being purchased, then you should ideally get a friend or relative to examine it to see how suitable it is for you to build a home or renovate an existing home. Also, you should ask to see photos of the property to help you determine if it is worth your while to acquire it. If you think you want to acquire the property, then you should get professional help, such as from a chartered surveyor or a licensed land valuator, to arrive at a valuation of the property.

Perhaps the best advice that can be given to potential returning residents is for them to have only professionals look after their business on the island. Some returning residents who failed to follow such advice have regretted doing so, as they spent their money unwisely and handled matters incorrectly.

If you hope to purchase land over a period, you should ensure that payments are made promptly, as the vendor has the right to cancel the purchase agreement. Therefore, you should secure financing from building societies or other licensed financial institutions on a timely basis, to help with the prompt payment to the vendor for the land or home.

Returning residents should be vigilant to avoid questionable financial consultants and entities whose credentials are suspect. To be on the safe side, it is best that you check with a local Returning Residents' Association for a list of accredited financial consultants and financial institutions, including building societies.

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, such as the ones located in this Home Centre.

Most local realtors would recommend that returning residents purchase a house rather than acquire property to build one. This is because the second option has been problematic in some cases. 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.