Ordinarily, when you want to purchase a landed property in Nigeria, there are common features or requirements you should have in mind. One has to know what you want, the budget you have at hand, the location of the property, the size of the land, the surroundings/amenities around, how you are going to make the payment, and the required documents you might need. These are the common things to have in mind. Unfortunately, the majority that has purchased their land with these in mind have fallen victims to many flaws associated with land purchase.
These days, purchasing land in Nigeria requires more than just these common features and requirements mentioned. It goes beyond because many have fallen victim to land scams without knowing that they are victims. Property purchase is the easiest scam many Nigerians fall victim to on daily basis. It is not supposed to be. Knowing that to purchase land in Nigeria is not easy, one has to be safe and intelligent before making any kind of purchase no matter the cost of the land. Whether it cost N100,000 or 1 Billion nairas, you have to protect your money.
This article will create awareness and educate the potential and intending land buyers in Nigeria on what to do and what not to do before purchasing any property.
Conduct A Property Search
Before paying for any landed property in Nigeria, you must conduct a serious search on the property. For those that are oblivious of what property search is, it means knowing the validity of the property you are buying. Property search is one of the key parts of the conveyancing process. Yet, for most buyers, these essential enquiries can seem confusing and clouded by legalese that makes the eyes glaze over. This prompts many ignoring this important process of land purchase in Nigeria. Property search is hugely important. They help your conveyancing solicitor put together all the pieces of a transaction much like a giant jigsaw. Each search provides information about a certain element of the property. When all the details are put together, your solicitor has a complete picture of what the property looks like. Crucially, the area around it is also revealed. In most developed countries there is a good number of searches that are normally conducted or undertaken by your lawyer on your behalf. These include Local Authority search, Water Drainage Search, and environmental search.
These three essential property searches are possible in countries and cities with a functional master plan. For instance, a Water Drainage Search is a search that confirms whether a property is connected to a public sewer, septic tank or other private disposal facilities. It will also confirm if the property is connected to a public or private water supply. Finally, the report will confirm if the property is close to or affected by water mains or public sewers. Environmental Search on the other hand is a search carried out by a specialist environmental search company of past land-use records relating to the area, to check whether the land is likely to be contaminated land within the meaning of the Environmental Protection Act. This is a desktop search and does not involve a physical inspection of the site by the search company. These two searches are strange to our society because most of the utilities and facilities mentioned are provided privately.
In our context, we are going to look at the property search that is feasible and obtainable here.
i. Local Authority Search:
The local authority search is to obtain a variety of information from the local council, such as whether the property is affected by plans for a new bypass or a planning enforcement notice. Every local authority in Nigeria has a land-use plan for that locality. Most times, this important search is ignored or neglected by the land purchasers because they believe they can bribe their way out. Recently at Abule-Ado area of Lagos state Nigeria, many properties were demolished because they were erected in areas designated for a major road. The Federal Housing Authority warned before the erection of the buildings but was ignored because the builders believe money can solve everything. No matter how long it might take, once the land is designated for a particular use, do not go into the land and erect something contrary to that particular use because someday somehow, a serious authority will come in to implement what was in the layout plan.
Whenever you plan to purchase land, please, get a lawyer/solicitor to conduct a proper search for the said property. Lagos and Abuja, in particular, are so notorious when it comes to the sale of landed property with so many complaints surrounding it.
The investigation and title search may be conducted at the Locus, Lands Registry, Probate Registry, Law Court, Corporate Affairs Commission (CAC), the city planning authority such as FCDA, LASPPPA, UCCDA, Economic and Financial Crimes Commission (EFCC), Independent and Corrupt Practices Commission (ICPC), etc. Real property may be a proceed of crime or a subject of investigation for fraud and money laundering. This may warrant your solicitor to carry out due diligence at any anti-graft agency.
ii. Planning search:
Conduct a planning search to find out whether the neighbours have got planning consent for a large extension or if a planning application has just been lodged for new development in the feature.
iii. Land registry pre-completion search:
Make sure the seller still owns the property on completion.
When a good property search is conducted, the buyer through his solicitor or whoever was hired to perform the search will have a handful of information about the property. The search should be able to provide the following result;
A. Vendor’s Root Tittle:
This is a title that states the owner of the land. The title includes a deed of gift, deed of legal mortgage, assent, government gazette, government concision, and probate. Certificate of Occupancy can sometimes be a bad root of title in cases where there is an existing interest in the land. This is because the Certificate of Occupancy is only prima facie evidence and raises a presumption that the holder is in exclusive possession and has a right of occupancy over the land in dispute. This presumption is rebuttable because it can be displaced by evidence of a better title.
A defective vendor’s root title is a bad acquisition. A good root of the title must cover the legal and the equitable interest of the land being purchased and clearly describe the land and extent of interest being conveyed, state the owner of the land and with a clear picture that nothing on the document will create doubt.
It is also important for the buyer to know the capacity of the vendor (Land Owner) conveying the interest in the title of the land. You should try as much as possible to have a preliminary engagement with the vendor. Holding a meeting with the landowner should enable you to inquire into the nature of the vendor’s title to the land. This will let you know if the land was inherited, purchased, gifted, assented, mortgaged, leased, or acquired by virtue of long possession). In a situation where the vendor is selling as the beneficiary of the property, ensure that certain agreements would be implied such as;
- That the vendor has a good title and grants quiet possession of the land
- That the vendor agrees to indemnify the buyer in the event of a claim buy another claimant on the property
- That property is free from any encumbrances.
When you conduct a good property search, you should be able to identify if the property is free from encumbrances or not. An encumbrance is a hindrance, burden, or any claim against the property that is not the owner. It may be a financial obligation such as a mortgage, which is attached to the title of the property and is transferred with that right.
C. Possession Free
Your property search should be able to indicate that the land you intend to purchase is free from any claim of right of possession by a third party. The land you intend to purchase must be free of any legal battle. It should be free from any kind of physical impediments removable but will interfere with the enjoyment of the property. A physical inspection of the property will show if the property is free or not from any type of impediment.
D. Land Use
As earlier mentioned, the potential buyer must discover what the land is designated for during the property search at a local authority. Land use is the categorization of land based on the use of the land. Whether it is for residential, commercial, recreational, agricultural, industrial, transportation, it is important that get land for the purpose for which the potential buyer wants to use the land. It would be detrimental for a buyer who intends to purchase land for commercial purposes like a hotel, shopping plaza, club, and e.tc to purchase land in areas designated for residential purposes.
E. Planning Law and Regulations
When you conduct a property search, it should be able to acquaint you with the necessary Town Planning laws and regulations controlling the area of purchase. Town Planning Law and Regulations may restrict the selling of land where the purpose for which they are intended to be used is contrary to the purpose of town planning.
F. Community Land/Family Land
When you intend to buy land, it is important to find out if the land belongs, to family, kindred, or community. If you are purchasing a family or communal land, make sure that there is the consent of the head of the family or the community. Any member of the family or the community that sells the land to you as an individual without the consent of the family or the community is considered void. Many land buyers have lost the land purchased because they have made such mistakes in the past. Don’t be a victim.
G. Free from Court Cases
Your property search should be able to reveal if the land you want to purchase is free from any litigation. This is very important, where land is a subject of a pending lawsuit, the power of control is vested in the court. The effect of this is to put others on notice that there is a dispute concerning the property and restrict the sale of any interest in the land. Some evil-minded landowners will hide and mislead the potential buyer to purchase the land in dispute. This is why it is important to conduct a thorough investigation. If it warrants publication before purchase, please, take the option.
Avoid Committed land
When you are purchasing land or during the cause of your property search and it was established that a particular area of land is designated as committed, it is in your best interest to stay clear from such property. Once land is designated as committed or under acquisition, it is only the government of the day that can revoke it. If not revoked by the government, buying a property in the area is doing so at great risk.
This is common in Lagos and Abuja. Many have fallen victim in the past and many are still falling victim in recent times. The government will always recover property designated or committed no matter how long it takes. Never think that government cannot demolish the properties no matter the cost used in erecting them. Although in most cases, the government might ask for ratifications. This means you are paying more or over above for the same property you have already paid for.
Hire a Solicitor vast in Real Estate
No matter how smart you are, no matter how vast your realtor or estate agent might be, please, hire or consult a real estate solicitor when you want to buy property especially when you want to buy land. Your lawyer will help you to avoid costly errors and future troubles which are common with land transactions and could place your interest in the land in jeopardy.
For a fact that land transaction requires an extensive investigation, the best person in a better position to make that investigation is the real estate solicitor. The title of the property should be checked. Your solicitor and that of the vendor (Property Owner) will draw up a Contract of Sale Agreement for you and the landowner to sign. The reason to sign this Contract of Sale Agreement is to assure the vendor that you will purchase the property after a successful investigation. Where the Contract of Sale Agreement is not available, the vendor has no obligation to prove that he has a good title in the land. With the signing of the Contract of Sale Agreement, the vendor is bound to avail the title document and evidence that the root title is in the land and trace the uninterrupted chain of transactions to the vendor.
Close the Deal
When all the parties involved are satisfied with the status of the property, the next in line is to close the deal. The closing is a significant part of land transactions. Once the solicitor is satisfied with the status of the land, the deed of assignment or deed of conveyance and every other closing paper prepared by your solicitor and vetted by the vendor’s solicitor, the deal is considered closed once the payment is made. At this point, after all, parties might have signed the document, the vendor shall hand over to the purchaser the original title documents. Once this is done, you are now in possession of the land and the newest landlord.
Tidy up and Perfect the Land Transaction
The Governor’s consent is consent obtained from the governor of a state on a land transaction. Without which will be deemed illegal in the eyes of the government and the law. Every subsequent transaction on the land cannot be perfected until the governor’s consent is secured. The consent of the governor confers validity to any act of alienation in land under the Land Use Act. Get the Governor’s Consent, pay the appropriate taxes (stamp duties) on the instrument and register or file the instrument at the state lands registry (and at the Corporate Affairs Commission – if purchased as a company). If the land is not registered it will be rendered inadmissible in evidence at the court proceeding.
Above all, land transactions is never a smooth one in Nigeria, the information availed is for general consumption only and must not be construed as an option for legal advice from professionals. When you have made up your mind to buy land, it is recommended that you seek proper professional and legal guidance from the real estate solicitor.