By Tatenda Kangwende
Introduction: What is at stake:
“The simple believes every word, but the prudent considers well his steps.”(Proverbs 14vs15; New King James)
“A prudent man foresees evil and hides himself, but the simple pass on and are punished.”(Proverbs 22vs3; New King James)
“Test all things; hold fast what is good.”(1 Thessalonians 5vs21; New King James)
“Look to yourselves, that we do not lose those things we worked for, but that we may receive a full reward.”(2 John 8; New King James)
Investopedia defines due diligence as:
“…an investigation, audit, or review performed to confirm facts or details of a matter under consideration.”(Article titled, Due Diligence; https://www.investopedia.com/terms/d/duediligence.asp#:~:text=Due%20diligence%20is%20an%20investigation,proposed%20transaction%20with%20another%20party ; accessed May 30th, 2023)
Merriam-Webster dictionary explains that it is:
“the care that a reasonable person exercises to avoid harm to other persons or their property.”
Certainly, an immovable property purchase is a most weighty matter to consider, and as such, one would like to encounter gain (acquisition of the property under consideration), and avoid harm (parting with considerable pecuniary resources, with no property in exchange).
Given the immense stakes, what follows is a raw outline of what reasonable checks may be made before purchasing real estate in Zimbabwe.
Properties whose mode of ownership is deeds:
- Request muniments from the prima facie owner (namely certified copies of the deed of grant/deed of transfer, as well as ID).
- Request other documents with which to verify the identity of the prima facie owner, such as, for instance, academic certificates, birth certificate and/or marriage certificate. If they bluster, pout, protest, vehemently object to such, pay attention…they could be a swindler thinking you are a mark.
- Also, ask for the passport of the prima facie owner; why? In Zimbabwe, passports expire every decade, ergo, the photographs and other identity details are likely to more closely resemble the facial features of the prima facie owner in question. Pay close attention to the passport photo and identity details, compare them to the deed and person in question, and see if they match. If not, make a mental note to possibly signal an alarm. Also, see if the passport has been regularly used or stamped, as such a tidbit of data helps underscore the verity of an individual’s bona fides.
- Visit the surveyor general’s office, so as to get a legal description of the stand. If the property has not been surveyed, red flag. Remember, “No diagram, no deed.”
- Conduct a deeds search at the deeds office. See if the copies of the deeds tally in terms of details; if not, begin asking questions and raising red flags. See if the names and details (nativity) of the prima facie owner and the named individual on the deed tally.
- The deeds search will also help highlight if there are any caveats, miscellaneous agreements, encumbrances (e.g. a mortgage bond), endorsements on the property in question (such as a sale in progress), et cetera; ergo, a deeds search is always imperative.
- If in doubt of the authenticity of the prima facie owner, consult a notary public (a specialist attorney). Seek their expert opinion, and see if they are able to verify the identity documents of said owner.
- Speaking of a notary public, ask them to write and send in identity documents in question to the registrar general, so as to verify.
- See if you are able to also report to the registrar general’s office and seek verification yourself. Be bothered and go the extra-mile; the pecuniary resources at stake are well-worth the conscientiousness.
- Ask probing questions (diplomatically, of-course), such as…is the property registered in the name of a minor? If so, then consent of the High Court is needed, as the State is the guardian of a minor until they reach the legal age of majority. Is it probate (deceased estate)? Then, a letter of administration from the High Court is needed. Is there a tenant at the property? Do they have an option or right of first refusal? Request to pore over the lease agreement, as it may have great bearing on the sale. Is the property held under the auspices of a trust? Well, a resolution of the trust is needed to effect the mandating of the sale and transfer of the property. If the property is a flat or townhouse, are the owner levies up to date? Request a levy clearance certificate from the owners’ association wherein that property is situate.
- Visit the local council: Check if their rates are up to date, as well as on the rights of the area (commercial, residential or both?).
- Visit the property in question. Conduct an inspection report (to get a description of the property as well as to survey it so as to appraise its’ market value).
Do the above, and, I seriously doubt that one will be swindled as an estate agent or serious property purchaser.
Property whose mode of ownership is local government cession:
- Obtain muniments of prima facie cession holder (namely, agreement of sale with them and the local authority, as well as certified copy of ID).
- Obtain further muniments from prima facie cession holder (e.g. academic, marriage and/or birth certificates). If the individual in question blusters or ducks and dives, pay attention and take note…one could be on to them.
- Again, if in doubt as to the authenticity of said muniments, check with a notary public, and possibly request them to write to the registrar general’s office, checking on authenticity of the ID documents.
- As before, reporting to the RG’s office is never a bad idea…erring on the side of overkill is worth assuaging doubts.
- Visit the local authority with the said agreement of sale and check the verity of the cession. A well run local council will have a tidy, up-to-date, orderly record of cessions, as well as a secure, comprehensive checklist to be followed by both buyer and seller so as to effect transfer.
Property whose mode of ownership is developer cession (and one is purchasing from the property developer directly):
What has subsisted in the previous subhead applies here, mutatis mutandis, along with the following additions:
- Obtain muniments from the developer, in particular, the deed of grant or transfer, proving that they own title to the land they are developing. If they huff, puff and bluster, again, watch out. Furthermore, if they produce an offer letter as a muniment, make sure your tail tingles, as, typically, an offer letter from the Ministry of Lands needs to then have a change of use permit approved by the Department of Physical Planning. If they are that far out of the game at this stage, then it may likely be years before they get round to obtaining a certificate of compliance. So, in such cases, walk away with your precious currency.
- Request for:
- The subdivision permit (issued by either City of Harare, City of Bulawayo or Ministry of Local Government, when the slated layout plans of the development have been approved).
- The development permit (issued by the aforementioned authorities’ engineers after the property developers’ engineering designs have been approved).
- Dispensation certificate (very key, as it signifies that the Surveyor General has put their imprimatur on the development and the survey that was done on it).
- Certificate of compliance: Signifies that all the requirements of the relevant local authority have been met, and all stand owners may build.
- View the property in question; see if it is up to spec and to your liking.
- Please try and only deal with property developers who have a proven track record. The organized and efficient ones are so transparent, diligent and efficient that one almost feels tempted in obviating due diligence.
In short, always remember the golden and silver rules of real estate due diligence, namely that, “Only part with hard-earned currency after having viewed the property in question, having seen that all the paperwork is in order.” Never rush or feel rushed, because, as street wisdom notes, “A fool and their money, quickly part.”
Property whose mode of ownership is developer cession (and one is seeking a secondary purchase from a cession holder):
A number of the points raised in the previous subheads apply mutatis mutandis, yet, to underscore and spell it out for the record:
- Request comprehensive muniments from the ostensible cession holder. This would include the agreement of sale with the property developer, their ID, and other identifying documents (academic, marriage and birth certificates; the whole shebang).
- Again, going the extra mile and authenticating the supplied muniments with a notary public and the RG’s office is never an imprudent step to take; when it comes to immovable property, erring on the side of caution is warranted.
- Once satisfied with the cession holder’s bona fides, check their claim with the property developer. A property developer worth their salt will have an orderly cession registry, as well as a comprehensive procedure of what buyers and sellers are to supply so as to effect transfer of cession.
- If the property developer in question leaves you feeling a little hinky or feeling the heebie jeebies, then also conduct due diligence on them; again, at the risk of saying it ad nauseum, erring on the side of caution in due diligence is warranted.
Do the above, and it will be very difficult to have the wool pulled over your eyes in a property sale.
- Article titled, Due Diligence To Verify Property Ownership by Attorney Godknows Hofisi, which appeared in the February 18th, 2021 edition of The Herald (https://www.cfuzim.com/2021/02/18/due-diligence-to-verify-property-ownership/ ; accessed May 23rd, 2023)
- Article titled, Some Important Safeguards When Buying A Stand by Advocate Arthur Marara, (https://www.facebook.com/attorneyarthurmarara/posts/206857644170692?_tn_=K-R ; accessed August 18th, 2021)
Tatenda Kangwende is a mortgages officer with Metbank (Pvt) Ltd, in Harare, Zimbabwe. Should one need his services, they are free to:
- Visit: 5th Floor, 3 Central Avenue, Harare, Zimbabwe.
- Call, SMS or instant message (WhatsApp): +263 714 729 043