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Unregistered property in Honduras totals $12.9 billion
The Institute of Liberty and Democracy (ILD) and the U.S. Agency for International Development (USAID) recently revealed the results of a study regarding land tenancy in Honduras that points to an alarming situation. Honduras ranks fifth in the world for unregistered properties. According to the investigation, $12,900 worth of property in Honduras is not registered, rendering it "dead capital", or frozen assets. Of these $12 million, 70 percent corresponds to urban properties; the rest is distributed in agricultural and forested areas and in the value of extralegal business activities. This represents a value three times greater than the legal fixed capital, 36 times greater than the total capital and reserves in the country's commercial banks, seven times greater than the total deposits in savings accounts, and three times greater than Honduras's total external debt. The analysis identifies two principle causes of the problem of frozen assets: the traditional property model and the legal system that regulates it. It is common that the same lot of land be registered to multiple owners, which makes it impossible for the person using the land to gain access to credit to invest in improving or taking advan tage of the property, indicates the study. According to the report, there are 120 laws in Honduras relating to property, which hinder the legalization of property. In one case land shared by squatters required 177 administrative actions to be legalized; 143 actions were needed for another property in apparently normal possession and use. The study also reports that anyone wishing to organize a commercial business must visit between 12 and 18 government offices. The situation is even worse if the person lacks the resources to hire a lawyer to fulfill all the legal requirements. For these reasons, according to the document, many Hondurans choose to operate in the informal economic sector and to live in houses constructed without building permits or in areas outside city authority. Likewise, many build on property with title problems due to unregistered transfers, unclear successions and an array of litigation. Regarding the report, the President of the Honduran Counsel of Private Business, Jacobo Regalado, explained that the figure of $12 million is deceptively large. Unregistered properties are already benefiting from public and private services. Also, he said that 85.7 percent of all the private business activities in Honduras are not legally registered. "They are goods and properties in general that belong to a certain person, but the property is not legally titled in the Property Registry. Everything built on the unregistered property is unprotected because it is not within the legally guarded framework of the country," he explained. The ILD / USAID study identified the following points: 1. It is not possible to determine with certainty the legal nature or use of municipal, national or and private land since there still does not exist a registry of State land or a registry of real estate. This situation has cause conflicts of government jurisdiction and a multiplicity of titles and registrations for property rights for the same lands. 2. The Honduran system does not have laws to deal with the marginal urban zones, to regulate massive development programs of tenancy on public or private land, or to define lots developed in informal neighborhood. 3. No adequate institutional framework exists to handle the problems found with legalizing the tenancy of persons irregularly occupying private lands while at the same time effectively protecting the rights of the owners of that land. 4. There do not exist any regulations to solve the legal problems of land rights that affect a high percentage of Hondurans. 5. The housing programs developed by the State have not culminated in the granting of property titles that can be bought and sold freely. In many cases, the property cannot be transferred until it is completely paid off, which generally takes more than 20 years. 6. The programs for titling agricultural lands has been developed without having designed the required institutional reforms to achieve the proposed objectives despite the efforts made or the money spent in the last 20 years. The majority of Honduran small farmers do not have reliable title to the land they occupy. The property titles granted during large programs of land titling cannot be capitalized on due to restrictions on transfer and seizure. 7. The Registry of Real Estate does not offer reliable information or legal security, having caused innumerable litigations by superimposing areas or by issuing multiple registrations to the same property. 8. The majority of the poor in Honduras can use their properties only for primary purposes (shelter, agriculture and production); generally they cannot use their property for other economic purposes. 9. There is a lack of interest and confidence upon beginning a legal business because it is difficult to see the benefits of the supposedly functioning legal system. 10. Institutions or entities have not been created or developed to permit legal small or mid-sized businesses to receive the benefits of information, credit, security, property transfer or the other benefits conferred by a true market economy. |
Jacobo Regalado |
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—Index— Title Search Reveals that the Zúñigas do not own the Land in Dispute Unregistered property in Honduras totals $12.900 billion The boundaries of city land in Comayagüela have been clear since 1900 Siri Zúñiga could get 100 million lempiras due to the negligence of the City A solution is proposed to the legal problems of tenancy in urban areas |
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