dictionary

Your Ghana Property Dictionary

Title Search:

A title search is an examination of all public records in the region or district to determine whether any defects exist in the chain of title records of ownership of the property. Records of conveyances of ownership are examined beginning with the present owner. Then the title is traced backwards to its origin. Other public records are examined to identify wills, judicial proceedings, and other encumbrances that may affect title such as variety of taxes, special assessments and other recorded liens.

Indenture:

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.

Freehold:

Freehold property can be defined as any estate which is “free from hold” of any entity besides the owner. Hence, the owner of such an estate enjoys free ownership for perpetuity and can use the land for any purposes however in accordance with the local regulations.

Mortgage:

A loan to finance the purchase of real estate, usually with specified payment periods and interest rates. The borrower (mortgagor) gives the lender (mortgagee) a lien on the property as collateral for the loan.

Probate:

Probate is a legal document. Receipt of probate is the first step in the legal process of administering the estate of a deceased person, resolving all claims and distributing the deceased person’s property under a will.

A document that transfers ownership of *settled land from personal representatives of a deceased tenant for life or statutory …

Vesting Accent:

Vesting deed or Assent is document that transfers ownership of settled land from personal representatives of a deceased tenant for life or statutory owner to another party.

The vesting deed or vesting assent must contain the following statements and particulars: (a) a description of the settled land; (b) a statement that the settled land is vested in the person or persons to whom it is conveyed, or in whom it is declared to be vested, upon the trusts from time to time affecting the settled land; (c) the names of the persons who are the trustees of the settlement; (d) any additional or larger powers conferred by the trust instrument; and (e) the name of any person for the time being entitled to appoint new trustees of the settlement.

In situations where a buyer is buying property inherited by a young person for example, it is vitally important for the buyer to check the vesting assent.  This document in lay man’s term basically confirms that the current owner of the property has truly and legally inherited the said land or property as per instruction from will and probate through the executors.

Stamp duty:

Stamp duty is administered under the Stamp Duty Act, 2005 (Act 689) as amended by Act 764 of 2008. The Stamp Duty is not a tax on transactions, but on documents brought into being for the purposes of recording transactions. It is therefore a tax on documents or specific instruments which have legal effect. Stamp duty on property transactions are normally paid by the buyer of the property.

Withholding Tax:

This is a tax levied on landlords of properties. The tax is 8% of gross rent income.

As a tenant looking to rent a property, it is wise at the beginning of any property transaction to inquire from the landlord whether you are liable to pay the withholding tax. In other words, is the quoted price inclusive of the withholding tax or not.?

Leasehold:

Leasehold means that you just have a lease from the freeholder (sometimes called the landlord) to use the home for a number of years. The leases are usually long term – often 90 years to 120 years  – but can be short, such as 40 years.

For all prospective buyers and tenants of property in Ghana, it is wise to inquire about the number of years left on the lease of the property that you are acquiring.   This should be carried out for the following reasons:

  1. Renewal of leases can be very expensive in certain areas.  This can add a considerable cost to the price of the    land or property.
  2. Where the property is being used as an investment or for redevelopment, it is worthwhile noting that a short lease will not be attractive to prospective buyers of the development.  Where it can renewed, it is worthwhile checking on the ease and cost of renewal.  Sleep Well In Ghana can refer you to competent Solicitors to give advice in this area.
  3. Where a tenant is renting a property on a long lease, the tenant should be aware of the length of the lease left.  Would the current landlord be capable of renewing the lease should it expire and you are still a tenant?  These are useful questions to ask yourself.

Affordable Housing:

The ability of a household to spend up to thirty percent (30%) of its gross annual income on the rent or purchase price of housing, where the rent or purchase price includes applicable taxes and insurance and utilities.  When the annual carrying cost of a home exceeds thirty percent (30%) of household income, then it is considered unaffordable for that household.