Aubrey Stewart | Who protects the homebuyer?

Here is an issue that I believe deserves greater public attention and serious consideration through government policy and regulation.

Imagine spending months trying to buy your first home. You find a unit in a new development, agree on a price and hire an attorney. Drafts of the agreement for sale are exchanged. You arrange your mortgage, pay legal and valuation fees, and begin the purchasing process. Everything seems to be going well. Then, out of nowhere, the developer decides not to proceed. Why? Someone else has offered more money and is willing to pay cash. Just like that, months of planning, time and money are lost.

In property markets abroad, this is called gazumping. In Jamaica, there is no specific statutory prohibition against it, and withdrawing before a binding contract is concluded is generally lawful. That tells us much about who our real estate laws protect and who they leave exposed.

WHAT THE LAW ALREADY SAYS

The Real Estate (Dealers and Developers) Act, which came into force in 1988, established the Real Estate Board to regulate dealers, salesmen and developers. The framework has struggled to keep pace with a more complex market.

Part IV protects purchasers under prepayment contracts. Section 29 requires their payments to be held in trust accounts with authorised financial institutions. Sections 30 to 32 govern withdrawals: before completion, a developer may draw only for stamp duty, transfer tax and up to 90 per cent of independently certified construction costs, and only after registering a charge in favour of the Board. Section 33 lets the Board step in when a development fails, recovering trust funds and enforcing its charge for purchasers.

These protections matter, but they leave major risks uncovered.

WHAT BUYERS ARE LIVING THROUGH

First, the period before signing. Until a binding agreement is concluded, purchasers can spend substantial sums on attorneys, valuations and mortgage arrangements, only for the vendor to accept a higher offer. There is generally no automatic entitlement to compensation.

Second, construction delays. In April 2026, the Real Estate Board’s register reportedly listed more than 157 developments as incomplete past their estimated completion dates. In St Catherine, purchasers at Hellshire View, a development by the Housing Agency of Jamaica and Rite Solutions Developers Limited, protested in October 2025 after reportedly paying deposits of up to $1.9 million and waiting three years for unfinished homes.

Third, deposit protection. In November 2024, the Board went to court against the developer of a 25-unit complex on Old Stony Hill Road, alleging that purchasers’ trust funds were withdrawn without the required charge in place and that signed prepayment contracts were not submitted. The Board had reportedly requested evidence of that charge as early as 2020.

Fourth, price escalation. Broad escalation clauses can leave buyers who signed at one price choosing between paying substantially more and abandoning their investment.

Fifth, hidden costs and financing risks. Legal, valuation, registration and mortgage charges add up, and delays expose buyers to changing interest rates and expired mortgage approvals.

Sixth, misleading representations. Advertised completion dates, designs, amenities or specifications may change after buyers commit. Without clear contractual protections, holding developers accountable is difficult and expensive.

These are financial risks that can undermine years of savings and planning.

DEPOSITS AND THE WAITING GAME

A deposit is not the developer’s working capital. Yet the Board has repeatedly raised concerns about developers failing to provide professional certificates, trust account information and the signed contracts they must lodge within 14 days.

In ordinary resales, deposit handling and refunds depend largely on the contract. However, the Act sets neither a maximum period between signing and completion nor automatic compensation for missed delivery dates, leaving buyers to pursue costly contractual remedies.

Even after construction, delays in obtaining individual registered titles can complicate financing, resale and ownership rights. Purchasers frequently provide the financing, absorb the delays and carry the uncertainty, while exercising limited influence over the process.

ETHICS AND THE REALTOR

What is legal is not always right. A developer who lets a purchaser incur months of expenses, then withdraws for a cash buyer, may have breached no binding agreement, but the conduct raises legitimate questions about fairness.

In 2023, the Board received 47 complaints concerning unlicensed real estate activity. The Code of Ethics Regulations, which already address conflicts of interest, advertising and disclosure, date from 1998, before online listings, digital advertising and WhatsApp negotiations became commonplace.

In August 2026, the Board outlined plans for a new Code of Ethical Conduct. This is welcome, but the Board has not yet determined how it will be enforced. Breaching the existing code can already cost a dealer or salesman his or her registration; the new code must carry at least that same weight for developers as well.

Buyers should know whom an agent represents, whether competing offers exist and whether advertised information has been independently verified.

YES, THE LAW NEEDS UPDATING

Calls for reform are hardly new. In 2013, the government proposed amending the Act to increase fines and strengthen developer accountability. The 2021 Throne Speech renewed a longstanding proposal for a Real Estate Authority of Jamaica to improve oversight and consumer protection.

An amendment bill now appears on the government’s 2026-2027 legislative priorities, and the Shared Community Bill is under consultation. But five years after that Throne Speech, comprehensive reform has yet to reach the statute books. Five priorities deserve attention:

Good-faith negotiations. Once a vendor accepts an offer in writing, a short, mutually binding exclusivity period should protect both parties. Vendors withdrawing solely for higher offers should reimburse reasonable, documented transaction expenses.

Completion and title standards. Prepayment contracts should specify enforceable completion dates, remedies for delays and title-registration arrangements. Purchasers need defined rights to refunds and compensation when developers breach contractual obligations.

Financial transparency. Buyers should be able to verify registration, required charges and compliance. Developers should disclose transaction costs, financing risks and conditions permitting price increases.

Penalties and accessible redress. Regulatory fines must outweigh the benefits of non-compliance. Purchasers need affordable, timely dispute resolution.

Enforceable professional standards. Agents and developers should disclose conflicts of interest, competing offers, material specification changes and the accuracy of representations made to purchasers.

These reforms would not eliminate commercial risk, but they would distribute it more fairly.

UNTIL THEN, PROTECT YOURSELF

Before purchasing, verify that the developer, development and real estate practitioner are registered. Confirm where deposits will be held and ask your attorney about required charges, title status and contractual safeguards. Scrutinise escalation clauses, completion dates, refund provisions and transaction costs. Obtain written confirmation of promised amenities and specifications. Never treat an accepted offer as a completed transaction until your legal position is secure.

A subsequent article will examine what happens after the keys are handed over, from defective construction to strata management.

For most Jamaicans, a home is the largest financial commitment of their lives. Yet the person providing the money often has the least bargaining power and bears the greatest uncertainty.

A functioning property market should protect more than the transaction. It should protect the people whose savings make that transaction possible.

Dr Aubrey Stewart is a public policy researcher and consultant who evaluates government policies and programmes. Send feedback to aubreymstewartiv@gmail.com