- By Chris Nii Abbosey
After the series on the role of surveyors in the last two weeks, I had a call about the need to delve more into scams related to the Real Estate industry in Ghana.
As you may be aware, every business or industry despite the success stories may have some miscreants or bad experiences. As we say in Ghana; “There is a black cat in every family.”
Similarly, in the Real Estate sector in Ghana, although not as big as that of the United States, Canada, Dubai, etc, also has its fair share of scams, fraud, and very unpleasant experiences.
There have been several systems put in place by the Lands Commission, Government agencies on lands and housing, Ghana Association of Real Estate Brokers (GAR), Ghana Real Estate Developers Association (GREDA) among others.
Nonetheless, the public must be advised to be cautious when trying to acquire a property; be it land or building.
Poor Documentation or No Documentation
In Ghana, since most of the lands are owned by Stools, Families, Communities, and the like, documentation is sometimes scanty. Most of these entities have ways of demarcating their boundaries and differentiating them from others. Some of these include planting a particular tree or plant along the boundaries. Others also depend on landmarks be it natural (Streams, Rocks, Moulds, etc) or artificial (Wall or Pillar).
This situation gives opportunity to unscrupulous individuals to develop fake documents to fleece unsuspecting buyers and even sellers. In other situations, there may be no documents at all. In the case where actual property (building) is on land, there should be some form of documentation, depending on the location. It is easy to find a property in a remote area not having documents, usually because such areas are unattractive. But for attractive locations, people go at length to get some form of documents to legitimize their claims.
Always insist on the documentation of the land or property before moving the transaction forward. When you get the documentation, no matter how scanty or detailed, send them to the lands commission and the town and country planning department of the local assembly where the property is located for verification. Should the seller or leaser tell you the document is available, but pay an amount to get it, know it is a red flag. Never part with money until you have done all the necessary checks with the appropriate agencies.
Too Good to be True
Since the country does not have a competitive pricing regime for the real estate sector, there is some huge variations in the cost of properties, even for ones that are similar and maybe in the same location.
When one wants to scam you, he may give you an attractive rate to excite and influence you to part with money easily. Beware of such deals. Sometimes it is not the cost per se, but the additions to the property may come so much on a silver platter that you may lose your guard. Such price deals are sometimes backed with documentations to appear genuine but never be fooled by that.
Always stick to the saying “If it is too good to be true, then it probably is,” until you can prove otherwise that it is legit. The reason is that “you can’t get something for nothing.” So what you do is to seek a second opinion from other people like; real estate brokers or developers, surveyors, lawyers, etc. You can also talk to those living in the vicinity of the property of their opinion because they usually have information that can verify or annul a suspicious deal.
Property Owner Cannot Be Accessed
Who sells a property and wouldn’t want to meet the buyer? It is rare in Ghana. Everyone who owns a property wants to be involved in the deal even when he or she has contracted a real estate broker.
That is not to say, there are no situations where properties have been sold or bought without the involvement of the property owner. A true real estate agent or broker will have an authority note from the owner in such cases. Others too will make you deal with close relatives and associates and lawyers apart from the real estate broker or agent.
This scam is one of the oldest and you are taken to the property when there is no one around. Other times they get others to pose as reps of the owner.
I remember a client who made me and him sign an undertaking at the Police station to prove that I was genuine and the true representative of the homeowner. All relevant documents of me were taken, same as the client and undertaken signed. I bet a lot of fraudulent dealers will not subject themselves to such a process.
When the Whole Process Is Rushed
Another trick is when you are rushed through the process. Fraudulent dealers will cook a story of emergency, that requires quick parting of money to save a situation. Real Estate deals are meticulous and take time due to the amount of documentation involved and checks and balances needed to be done to ensure a problem-free transaction.
No Serious Real Estate professional will rush you through the process because he or she also wants peace of mind after the deal and needs your recommendation too.
When being rushed, find a way to slow down the process by requesting documents for verification. If it is a fraud they will not be happy to give it out. Should they give it out, take time to scrutinise it with the right professionals and state authorities. These processes take time, hence will buy you some time to decipher their plot. You can also be rescheduling their intended meeting days and times to suit yours.
Empty or Inaccessible Property
This is similar to the Land Lord or property owner is not available vibe. Usually, you might be taking to the property only to get there and be told the key cannot be assessed and so, you should look at the property from a distance or in the case of building through louvre frames and all.
Some will even take you through some interesting routes to access the property. In some cases, the property will be furnished and you will be told the owner is no more in the country and wants to dispose of the property or rent it out, but the key is yet to be sent from the caretaker, who cannot be found. These are all red flags.
You can return to the property at a different time to talk to neighbours to ascertain the true status of the property. You could use the documentation demand or police station undertaking strategy.
More Ways to Avoid Real Estate Scam
Apart from the scams and solutions provided above, these are a few more tips to support them.
Beware of restrictions associated with the property you are negotiating for. For instance, you may be told, this like, don’t talk to the people around. Do not mount poles on the land yet, do not pour sand or stones on the land. These are all schemes to prevent you from having a second opinion from those in the vicinity of the property
Always Try Not to Pay Cash, although Ghana is largely a cash society. Using bank transfers and other payment modes that leave traces will help to track people should you be tricked into parting with money.
Be sure to Research before concluding a Real Estate Deal. This may sound sophisticated, but it is simple. These days some properties are listed online, so should someone send you a property deal, check the property online on meqasa.com, tonaton, cbcghanaltd.com or other online listing portals. You can also talk to a trusted real estate agent or developer.
Have a Trusted Real Estate Professional in your network. Do not wait till you want to buy a property or sell one before contacting a Real Estate Broker of Developer. These days most of the quality Real Estate Professionals consult too. Book an appointment and seek their knowledge in the sector. That way should you have an offer it makes it easy to connect and get his or her opinion and assistance to avoid being scammed.
Feel free to contact the Ghana Association of Real Estate Brokers (GAR) and GREDA for recommendations to a genuine, litigation-free and peaceful real estate deal.