admintitle to the property they intend to buy.
This may at first seem cumbersome to the unseasoned investor. But eventually, it will prove invaluable as it protects them against being conned of their money. It is trite in investment circles that property has become the leading investment option in our economy.
It offers both security on money invested and assures a substantial return on the investment.
It is from this background that people are susceptible to being duped by seasoned con-artists with fraudulent property title documentation who prey on people’s hopes of making money out of property investments.
One of the most common methods that these con-artists employ is to create stories of desperation on the part of the seller, justifying the absurdly “below market” value of the property asking price.
This, in essence, presents the potential purchaser with a façade of a once-in-a-lifetime opportunity to acquire real estate under extremely favourable conditions.
It then adds pressure on the potential investor to close the deal quickly as one realises that many might be after such a lucrative opportunity.
At this point, the investor will be duped and may not perform the requisite due diligent checks.
The first thing to verify is that one is dealing with a registered agent, where an agent is involved.
A visit to the estate agent’s office is important for assurance purposes and one can ask to see a valid compensation fund certificate at the agency to confirm registration.
Where one does not intend to take this route, one may simply call the Estate Agents Council located at Newlands Shopping Centre to confirm the registration status of the estate agent involved.
This process is also necessary when dealing with a legal practitioner. However, in the case of lawyers, one has to confirm their registration with the Law Society of Zimbabwe.
Where the property has deeds, one may ask either the estate agent or the lawyer to verify the authenticity of the title deed.
It is impossible to verify authenticity through an eye inspection. Where neither agent nor lawyer is involved, one may request a copy of the deed and verify its authenticity with the Deeds Office, for which a fee has to be paid.
Here, one may check whether the purported owners are the actual owners. It may be wise to check for any irregularities relating to the deed. Once this is done, the investor may consider making the investment.
Where the transaction involves a share transfer, one still has to verify with the Deeds Office whether the company purported to own the property is the actual owner.
Once this is confirmed, then the potential investor has to visit the Registrar of Companies to ask to view the schedule of shares on that particular company. Where the schedule matches the share certificate available as proof of ownership, then one may proceed with the transaction.
But it is imperative in such transactions to ascertain that there are no other liabilities affecting the company in which one intends to be a shareholder.
The other method of verification is in cession transactions. Cession is the ceding of property by written agreement or treaty with the purchaser getting immediate rights on the property.
In most situations, deeds are scheduled to come out at a later period. The norm is for the deeds to come out in the purchaser’s name.
This method of ownership is common with developers or new developments.
In terms of cession offered by councils the seller of the property must be in possession of an Agreement of Sale, which they entered with the council.
They should then approach the district officer in whose jurisdiction the property falls to apply for a cession.
The seller is to take along with them personal identification documentation, including their spouse’s personal identification documentation.
A spouse must consent to a proposed cession, regardless of whether or not the spouse is a co-owner of the property being sold.
The buyer is to accompany the seller when applying for the cession.
It is a requirement of the council that the buyer should have attained the age of majority and be registered on the council housing waiting list.
It is prudent that the buyer brings the spouse along with them.
The district officer will complete a cession application which the seller and buyer together with their spouses will sign.
The district officer retains a copy of the application on the property file at the district office and then sends the original to the director of Housing and Community services.
The district officer will refer the buyer and seller to the director of Housing and Community Services where cession will be concluded.
This process allows thorough checks to be executed on the documentation to avoid anomalies or fraud.
A cession fee is required and this amount will be computer-receipted at the offices of the director of Housing and Community Services.
A cession document is finalised and authenticated by the approval of the director of Housing and Community Services.
Council does not sanction sales of undeveloped stands acquired through its systems because it is deemed speculative and therefore does not advise the sale of unserviced/undeveloped land.
If buying such property, thorough investigations must be made with the local government, Deeds Office and or council, before one parts with their money.
When one is dealing with developed land without title deeds, it is necessary to verify ownership of the seller at the developer’s offices.
In normal cases the developer does the necessary cession changes. They also verify whether the seller has fully met their obligations with them.
One must be vigilant at all times to ensure that necessary due diligence is carried out in property transactions
Vengai Madzima is a property investment consultant and analyst with Wisdom Properties. He can be contacted on 0772 468 093 or email:
[email protected]
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