Purchase of land in Dar

I am entering into a contract to buy a piece of land in Dar. How do I go about it, and what should I do?
30 April 2012

Firstly, make sure a proper due diligence is done of the land. Start by lodging a search at the Registrar of Titles, to make sure the seller is indeed the seller. You can also check this register to ensure there are no mortgages, caveats or other encumbrances on the piece of land you intend to purchase. Secondly, make sure that you take the original title deed to the Registrar of Titles for physical verification. There are a lot of fake title deeds available in the market. You therefore need to be extremely sure that the one you will ultimately be holding is genuine. Since the land is not developed, it is important for you to make sure with the Registrar that there is no double allocation. A number of empty plots have disputes over double allocation, and the matter lands up in Court.

Thirdly, it is not a bad idea to speak to the neighbours to identify the seller to you. Make sure you are dealing with the seller or his duly appointed attorney. You should also avoid making cash payments for the purchase, amounts should be deposited into the seller’s bank account.
With the above due diligence done, you will be required to draw up a sale agreement for the land, and fill out and sign some standard land forms. A valuation report will be required for the assessment of capital gains tax. This is usually 10%, and is paid by the seller, unless agreed otherwise. There is also a stamp duty of 1% and a registration fee of 0.25% of the value of the transaction, as approved by the government valuer. These taxes are paid for by the buyer.

All in all, if the above is cleared, the transaction should not be complicated. It is not unwise to engage the services of your lawyer.