Fiji Islands Real Estate Practices

Overview
Fiji Islands society is diverse and cosmopolitan, consisting of Fijian, Indian, European and Asian influences. Approximately 50% of the population live in the greater area of Suva, which is the capital of Fiji.

Real Estate Practices
Real Estate commissions are usually paid by the seller and range from 4-5% except on lower priced transactions in which the rate of commission may be higher. A Value Added Tax (VAT) also applies for non-residential properties at a current rate of 12.5%.

Fiji Islands uses the Torrens system of land registration and all real estate property is registered in the local district and searchable for a nominal fee. The Torrens certificate contains information regarding the land, improvements, ownership and encumbrances. The register is available to the public at the Registrar of Titles in Suva. Currently it is not computerized.

Real Property may be mortgaged as security for debt and mortgages in excess of 60% loan to value and a ten-year term are common and acceptable. The most common mortgage sources are banks and financial institutions.

Closing procedures are regulated by the government and usually occur within 60 days of contract execution. Once the contract is executed, attorneys for both parties effect settlement of the sale and arrange for registration of the new owner of the property. Legislation is in process to expand the role of the real estate agent and attorney to that of licensed conveyancer thus allowing both parties to manage the entire process.

The Fiji Islands Trade and Investment Bureau’s website http://www.ftib.org.fj provides more information regarding the purchase of land by non-Fiji residence.

8.0   Acquisition Costs
Real estate commission is typically paid by the Seller and range from 4-5% of the selling price. It is customary in Fiji to pay a higher commission on smaller sales, however commissions are negotiable. Stamp duty is payable by the purchaser in a real estate transaction.

8.1   Property and Ownership Information
Fiji uses the torrens system of land registration. All parcels of real estate are registered and the information is searchable by the public for a nominal fee. The torrens (Title) certificate contains information regarding the land and improvements as well as ownership information and encumbrances on the land.

8.2   Transaction Information
Open listings for agents are: Available. Exclusive listings for agents are: Available. Transaction information is compiled by governmental agencies and private firms. These data are publicly available upon payment of a fee.

8.3   Real Estate Trade Association
Fiji is currently in the process of forming a Real Estate Institute. Currently no such real estate trade association exists.

8.4   License Requirements
No real estate license is currently necessary for real estate agents. This is likely to change with the forming of the Real Estate Institute of Fiji.

8.5   Land description meters and bounds survey system
Legal descriptions are unique for each separate parcel of land. All crown land when defined for grant, lease or reservation is given a section number and in general these are Sections of a Block of a Survey District. The whole of Fiji is covered by various surveys that are broken up into various blocks. In some parts of the country Squares. Crown land has also been granted under a variety of miscellaneous descriptions, in parts of the country as Sections of a Settlement and Sections of Villages.

8.6   Rights and interests in land
Land and improvements erected on land are considered real property under Fiji law. The government controls about 7% of the land and retains certain rights in land such as the ability to levy property taxes, control the use of private land through zoning and take property for valid public purposes under the right of compulsory acquisition. Ownership of certain types of real estate by non-resident foreigners is restricted. Crown and Native land cannot be purchased outright but leased for which there is a process of obtaining ministerial consent. Spouses may hold title to real property separately. However, the primary residence of a husband and wife is considered community property with the right of survivorship upon the death of either spouse. Leases are largely unregulated and simply governed by the agreement of the parties.

8.7   Forms of ownership
Ownership of real property in Fiji may be by individuals (severalty) or by more than one person (concurrence). Corporations and partnerships are capable of acquiring, holding and conveying real property in Fiji. Partnerships can have no more than 20 partners except in limited instances. "Special Partnerships" are similar to limited partnerships in that the "special partners" are not responsible for debts of the partnership. Each special partnership must have at least one general partner. Joint venture and trusts may also own real property in Fiji.

8.8   Transfer of title
Deeds are used to convey ownership of real property in Fiji. Deeds must be signed by the grantor and voluntarily delivered to the grantee. Corporate deeds require a seal and in many cases acknowledgment by a notary. Real property may be conveyed after death via a written will or, if a property owner dies in-state, by operation of law. If a property owner dies in-state and with no survivors then property will escheat to the government.

8.9   Recordation and transfer of title
Fiji has a land title system based on the torrens system of land registration (see Section 8.1). There is a titles registration office in Suva, Fiji where titles must be registered. The register is designed to be relied upon and registration provides conclusive proof of ownership and related matters affecting title. Under the torrens system, there is no need for title insurance or abstracts.

8.10   Contracts
A valid contract for the purchase and sale of real property in Fiji must be in writing. Attorneys (solicitors) will often prepare contracts for larger transactions or review those contracts for smaller transactions. Fiji is a common law country and in most instances, the law of contracts is similar to that of England and the U.S. Real estate agents may prepare contracts for the sale and purchase of land. Contracts for the sale of real property do not need to be notarized and may be prepared by real estate agents in Fiji.

8.11   Mortgages
Real property may be mortgaged as security for a debt in Fiji. Mortgagors are required to register mortgages with the Registrar of Companies. The order of registration determines priority of the mortgage. Actual ownership is not transferred under a mortgage, only a pledge or hypothecation. Mortgages contain power of sale remedies and provisions for a mortgagee to enter and the possession of a property upon default and notice. Notice must be at least 4 weeks, and mortgagors retain rights of redemption.

8.12   Financing and lending practices
Fixed rate loans of greater than 60% of value and terms in excess of ten years are common in Fiji. The typical source of mortgage financing is banks and institutions.

8.13   Property taxes
Stamp duty is payable on all conveyances of real property as well as real property leases. Stamp duty on real property conveyances is 2%. Real property leases carry a stamp duty of 1% on the annual gross rent. Profits delivered by entities dealing in the sale or disposition of real property with the intent to make a profit are subject to tax. Usually personal residences are not subject to tax on sale. There is no capital gains tax in Fiji.

8.14   Closing and escrows
Settlement procedures are regulated in Fiji. Closings typically occur within 60 days of contract execution.

8.15   Valuation (Appraisal)
Appraisals are not generally required except in cases where a lender is involved.

8.16   Insurance
Property and hazard insurance is typically required by mortgage lenders.

8.17   Land use control
Zoning is used in Fiji, as a tool of government to control the use of privately owned land. Fiji has national planning documents which are intended to promote environmental standards as well as protect coastal areas. Subdivision regulations control how land may be converted into building lots while local zoning ordinances provide for specific permitted and prohibited land uses and the separation of incompatible land uses. Zoning in Fiji is implemented in accordance with Town and Country Planning efforts.