The transfer tax and stamp duty are fees that are attached to your cost when you are involved in a transaction for houses for sale in Jamaica is usually at a percentage value of the land. Normally the value is in line with the sale price.
The transfer act states that transfer tax is 7.5%. There is a relief an amount of $10,000.00 relief where the value of the land is $150,000.00 or less. The type of home does not matter. It is usually a misconception that Jamaica beachfront houses for sale attract a much higher transfer. This is simply not true. However there are some exemptions to these Jamaican property taxes.
1. Transfers of property by Jamaican Government and Local Authorities.
2. Transfers to government or Local Authorities of Jamaican land for purposes such as roadways and other reservations in sub-divisions.
3. Transfers by way of gifts to approved institutions of property to be used exclusively for charitable purposes.
4. The Principal place of dwelling of spouses (Joint Tenancy or Tenancy in Common) In the event of death only.
Stamp Duty – Payment of Stamp Duty is governed by the Stamp Duty Act. The stamp duty payable on land is approximately 5.5% of the full value of the land/dwelling.
Certification of title:
Once a property is registered it is given identification by way of Volume and Folio numbers in the Register Book of Titles. The original Title is kept at the Office of Titles and entries are made thereon whenever something affecting any interest in the land is brought to the attention of the Registrar of Titles. For example, a transfer, a mortgage, death of a part owner, grants of easement and so on. This is standard for all houses for sale in Jamaica.
The land owner gets the duplicate Certificate of Title on Registration. Duplicate Certificate of Title has to be submitted to the Registrar for endorsement of all transactions affecting the land.
The Conveyance or Transfer of Houses In Jamaica For Sale Exercise
This normally begins either between seller (vendor) and buyer (purchaser) or between either one of the aforementioned parties and a Jamaica real estate dealer or Jamaica property agent. Purchaser or an attorney should inspect the Duplicate Certificate of Title. This is vital as some homes in Jamaica for sale come without sale agreements and hence no transfer might have taken place. A title proves exactly who the owner of the land is.
The usual form of Purchase and Sale Agreement sets out inter alia:-
(1) The legal names, registered address and gainful occupation of the contracting parties.
(2) Full description of the house in Jamaica for sale – including size or actual dimensions, registered location, and the identifying folio and volume numbers of the Certificate of Title, in the case of both registered Jamaican buildings and land. In the case of land with a Common Law Title, the size, description, boundaries and other relevant details.
(3) Purchase Price – in words and figures to avoid mistakes and misunderstandings.
(4) Completion – the effective date when the final payment for transaction is anticipated to be collected and the full sale completed, that is, transfer effected, cheque and titles exchanged.
(5) Cost of transfer – unless otherwise agreed, this usually states that each party should bear half the cost of Stamp Duty, Registration Fee and Attorneys Costs.
Payment of Jamaica real estate agents commission – paid on the Completion of the transfer of title and the closing of the transaction.
Fees on sale and purchase of land
1. Transfer tax – 7.5% of market value (Vendor only)
2. Stamp duty – approximately 5.5% of Market Value
3. Registration fee – Approximately 2% of Market Value (or $2.00 per 1,000)
4. Attorney’s costs – As per Scale – Jamaican Bar Association (effective 1st June 1991)
5. Surveyors Identification Fees:
(i) Values up to $500,000.00 = $1,500.00, thereafter, 0.1% up to 1 million, thereafter, $1,000 per million. Plus Research and Title fee/charge of $400.00.
(ii) Properties in excess of 1 acre or Irregular Boundaries a traversing fee is added. Fee depends on length of traverse.
(iii) If land is outside the corporate area $6.00 per mile.
6. Valuation Fees:
Kingston Jamaica Corporate Area
Corporate Area: Cost $3.00 per 1000 of the market value and $150.00 for travelling and incidental expenses. Minimum fee of $1,000.00 plus travelling and incidentals $1,150.00
Outside Corporate Area – (Beyond 15 miles from Kingston Jamaica) 3.50 per 1,000 of the market value plus travelling @ $3.50 per mile minimum fee of $1,500.00 plus travelling.
7. Mortgage Costs: (Building Societies)
(1) 1% application fee (Saver)
(2) 2% application fee (non Saver)
(3) Life Insurance – amount differs according to age.
NB. No longer will Compulsory Society take an assignment of Existing Policy.
(4) Mortgage Indemnity: 7% of sum being Insured applies when Mortgage in excess of the standard two thirds – 90% Mortgage.
(5) Stamp duty on Mortgage
(6) Registration Fees on the Mortgage
(7) Attorneys Costs
(8) Valuation Fee
(9) Surveyors Identification
(10) First Month Mortgage Payment
Mortgages: – $1.00 per 200 x 25% or 0.65%
These outline all the costs associated with buying houses for sale in Jamaica. It is important that both the vendor and purchaser understand the fees associated with this Jamaica real estate transaction.