Somaliland Land Registry - Property credits, fair taxes and less land disputes!
„What is the most valuable asset a country has? It is the land within its borders. For Waddani this is a reason to take care of this land, to organize and manage it properly. This is why we are going to establish the first sole IT based and GPS assisted centralized land registry that eventually will enable us all to boost the economy of Somaliland!“
- Abdirahman Mohamed Abdullahi
With your mandate, we will establish a centralized land registry to organize and control the country’s lands and to create a basis to the benefit of all of us in Somaliland:
- Through the centralized database it will be possible to decrease land disputes
- The government will finally have a fair basis for proper taxation that is not based on relationships or corruption
- It will increase the overall investment safety and thus encourage the much needed FDI Foreign Direct Investments in Somaliland
- The likely most important fact will be that finally properties can be used as collaterals for a bank loan from the „Somaliland Land Bank“, a new bank managing all property related payments and loans
What is a land registry?
- Basically, a centralized land registry is a huge database, that is connected to a map. The database includes information of each property and the map is a graphic assistance. Each entry in the data base is connected to a plot in the map.
- Each entry in the database contains information about the current and past owner, the dimensions of the plot, the price that has been paid on purchase etc. It holds all valuable information about any plot.
- These information are the basis for a fair property taxation, will prevent future land disputes and will organize and manage the country’s most valuable asset: the land within its borders.
What are the key figures and financial projections?
using the example of Hargeisa
|Hargeisa city area:||50 sqkm (50.000.000 sqm)|
|Estimated 50% of it private property:||25 sqkm|
|Average property value:||50 $/sqm|
|Private property value of Hargeisa:||1.25 billion $|
|Annual Property Taxation:||1,50 % of the purchase price|
|Property Tax Income p.a.:||18.750.000 $|
|Property Transfer Tax:||3,50 %|
|Property value transferred p.a.:||30.000.000 $|
|Property Transfer Tax Income p.a.:||1.050.000 $|
|Overall Property Tax Income p.a.:||19.800.000 $|
These are the figures for Hargeisa only. For all of Somaliland we calculate with an eventual annual tax income of around 60-70 million $ that will be put to the benefit of the whole country. The initial income from Hargeisa will be used to finance the distribution of fresh water from the desalination plants.
How we will start
To successfully introduce and lead such a drastic change, the whole process has to be broken down into several steps, so we all can get used to the new processes.
- Year 1-2
- First, for the government it is mandatory to get back the authority about all processes related to land. Thus we will introduce new, certified and registered governmental notaries. There will only be a distinct number of public notaries in each city. All property sales have - by law - to be made through these notaries. These notaries collect all data of the sales, including previous owner, new owner, price that is paid etc.
- Year 3 and after
- The government will publish a table with average prices for each district in Hargeisa (on basis of the collected data from the notaries).
- To prevent tax evasion by paying cash directly to the owner (circumventing the notaries), the notaries will compare prices from the table to the notarially certified selling price. If prices differ more than 20%, the landlord has to explain in a written and signed document why there is such a huge difference.
- The „Somaliland Land Bank“ will be created, through which all future purchase prices as well as all taxes and other land related fees have to be paid.
- All prices and fees have to be paid in min. 50% in Somaliland Shilling and in max. 50% US Dollars.
- Each landlord, new and old, gets and account at the bank.
- The current landlords can use their properties as collaterals for loans from the bank.
- Loans will be provided with min. 50% in Somaliland Shilling and max. 50% in US Dollars.
- On each sale a measuring team of the land registry will move out to measure every sold property (incl. the ground floor measurements of the buildings it holds). These measurements will be taken by laser and GPS and put in to the map.
How will it work?
The whole land registry will be computerized and GPS based, making us one of the first nations in the world having a sole IT based land registry.
- At the very beginning the database and the map have to be created.
- The database will be a computerized one, embedded on several servers and backup locations.
- The map will be produced through a combination of laser measuring equipment assisted by GPS based technology, to ease the process of mapping in a computer-based GIS, Geographic Information System.
- The mapping will be done systematically, starting in Hargeisa’s central business district and covering all areas around step by step.
- We plan to start public service (and thus be done with mapping Hargeisa) within the first 3 years after election.
- In the long term in each city a land registry office will be established to serve the local population.
The land registry might not be such an obvious change but it will change a lot to the better. It will be another step for Somaliland to move ahead, to develop and enable us to be the partner of choice in the region.