Real estate purchase and sale transactions are fraught with many risks that can lead to the loss of considerable money or property. There is nowhere for a buyer or property owner (seller) to gain experience, since such transactions are rarely concluded by the majority, by many only once or twice in a lifetime. To minimize the risks, you need an experienced outside specialist – a real estate lawyer.
Welcome to Lawrange, where you can find such a specialist and use his services. This means finding out the hidden pages of the history of a property that is being sold or rented out, avoiding investing in a potential “unfinished” or “long-term construction”, and so on. We will conduct a thorough examination of the documents for the object in order to detect errors and inaccuracies in time, as well as, if possible, provide assistance in correcting them.
New construction lawyer: what you need to know before buying
Acquisition of housing in the primary market can be a profitable investment if two main conditions are met: 1) a thorough preliminary check of the object itself and its seller; 2) the correct development of the contract for the transfer of rights to the property from the seller to the buyer.
In this way, you can minimize the main risk of buying an apartment on the primary market – the so-called “unfinished”, that is, frozen construction. Also, these actions help prevent the sale of an apartment in a new building to several buyers at once and other dishonest actions on the part of the seller.
Important! Before buying an apartment, at least get answers to the following questions:
- What is the reputation of the seller/developer? At the first stage, the information that can be found in the public domain on the Internet will be enough – we are talking about articles in the media and reviews from other buyers.
- How reasonable is the cost of the apartment? It is necessary to clearly define the average price in the market. Wariness should be caused by both underestimated and overestimated prices. Underestimated – often caused by the desire to hide problems with building permits and other documents, as well as other “pitfalls”. Overpriced is allowed only if there are additional bonuses, for example, a very convenient location, good infrastructure, a beautiful view from the windows, and so on.
- Is the seller ready to show the documents at your request and are they in order? It is not worth continuing communication with a seller who does not want to submit documents. If the seller agrees, then you should request: a) documents for the land plot (confirmation of ownership or long-term lease agreement) – be sure to pay attention to the purpose of the land; b) building license; c) construction project; d) permits for construction work.
However, getting answers to these questions is only the minimum that allows you to decide whether the object deserves further attention. It is advisable to conduct a comprehensive legal due diligence before buying.
Due Diligence of a property in Lawrange Attorney Association
With nuances depending on what kind of object it is, a new building, housing on the secondary market or commercial real estate, a real estate lawyer checks:
The land is checked in the State Register of Property Rights and the State Land Cadastre, as well as on the cadastral map. The legitimacy of the ownership or use of the site is determined, the availability of all necessary approvals for the withdrawal, withdrawal, change of intended use. Even for a conscientious owner, the documentation may contain inconsistencies – overlapping coordinates of neighboring land plots, discrepancy between the actual location of the plot and its coordinates on the map, and so on.
It is extremely unpleasant when, during the pre-privatization preparation of the site, an illegal change in the intended purpose occurred. This may become the basis for the recognition in court of invalid decisions of local governments on the transfer of land ownership. In some areas, construction cannot be carried out in principle, taking into account the security zones, surrounding buildings, and so on.
Permits and technical documents.
If we are talking about an object built a long time ago, it is necessary to check the design documentation to make sure that there are no redevelopments and reconstructions. If the object is a new building, the following documents are checked:
- builder’s license;
- town-planning conditions and restrictions;
- technical conditions;
- project documentation;
- expert opinion on the quality of design solutions;
- permission to carry out construction work;
- building readiness certificate.
Information about these documents is checked against the registers of the architectural and construction inspection. Very serious are at stake things – without permits, the house is regarded by the regulatory authorities as a squatter (unauthorized construction), which gives reason to even raise the issue of demolition, not to mention other less significant consequences, for example, difficulties with connecting to communications.
For your information! It is the lack of a complete package of permits that is the main reason for the “long-term construction” in Ukraine. For example, if the initial master plan differs significantly from what was built, or the right to start construction work is canceled by the GIAG, since the class of consequences (the category of work complexity) was underestimated, the object becomes impossible to put into operation. Such a new building clearly cannot be considered a promising investment object.
If we are talking about real estate that has already been put into operation, then a real estate lawyer must determine what is a title document (on the basis of which the ownership right arose). This can be done, in particular, through the State. register of property rights. The title document is often a contract of sale or a document on privatization. The situation is worse if a court decision acts as a title document, since interested parties can re-initiate legal proceedings. And the protection of a bona fide purchaser under the current legislation is rather weak.
When checking the title, it is also necessary to make sure that there are no encumbrances of property (pledges, arrests), which affect the seller’s ability to dispose of this property and identify potential rights to it from third parties.
- The history of the object.
First, it is checked who and when started building the object, what documents served as the basis for the construction. Unpleasant surprises can arise in a situation where the document on the commissioning of a new building was canceled and then renewed by a court decision. Sometimes such “historical defects” lie on the surface, but in some cases you have to delve into the documentation for years. The history of the object also implies a chain of transfers of ownership, if any.
Risks can be associated not only with the property itself, but also with the seller or developer, as well as with other persons involved in the construction (and this is a contractor, designer, customer, and so on). All legal entities and individuals present in the documents and associated with the object should be checked. You should find out information about the beneficiaries and the place of registration of the seller company.
The seller is checked according to the general algorithm as for the counterparty: the absence of tax debt, open judicial and enforcement proceedings, etc. Do not forget about checking the signature of an authorized person, because we are talking about a big agreement.
Important! Based on the results of such a check, a real estate lawyer prepares a legal opinion.
Real estate lawyers – our services:
What a real estate lawyer always starts with is a consultation. Our team is ready to answer any legal issues related to real estate, from solving problems with the legalization of unauthorized construction to complex disputes over the ownership of real estate, the consideration of which goes to the court of appeal and cassation. At your request, we will discuss the issue at a personal meeting, by phone, in a messenger or via video call.
Then you can immediately order a range of services from us, for example, support for a turnkey sale and purchase transaction, or a separate service, in particular, verification of the participants in the transaction and persons related to the property, development or examination of a sale and purchase agreement, and so on. Further. Regardless of your choice, we guarantee a consistently high quality of services.
Take a look at some of our comprehensive offerings.
Accompanying the purchase and sale of real estate in new buildings:
|Service||What is included|
|Real Estate Lawyer Consultation||Assessing the risks of buying a home in a new building.|
|Due Diligence||Checking a new building, a land plot, a developer company and a construction contractor.|
|Work with documents||Analysis of construction investment contracts.|
|Legal support||Negotiating with the seller.|
|Other||Protection of the interests of the investor in court, assistance in the sale of real estate that has not been put into operation (assignment of rights).|
Accompanying the purchase and sale of real estate in the secondary market:
|Service||What is included|
|Consultations||Answers to questions related to the purchase or sale of apartments, cottages, townhouses and other residential real estate.|
|Due Diligence||Checking the seller (buyer), the object itself, as well as title documents.|
|Work with documents||Development, examination and amendment of the contract of sale.|
|Legal support||Negotiating with the owner.|
|Other||Protection of the interests of the buyer (seller) in court.|
Commercial real estate transactions
|Service||What is included|
|Consultations||Answers to questions related to the sale or lease of financial premises, shopping malls, hotels, industrial facilities.|
|Due Diligence||Verification of the owner of non-residential premises, the object itself, as well as the study of documents for the land plot.|
|Work with documents||Development of the structure of the transaction for the acquisition (sale) of real estate, examination and amendment of the contract.|
|Legal support||Presence at the notary when signing the contract.|
|Other||Planning the tax consequences of the transaction, developing a scheme for the safe implementation of cash settlements.|
Legal assistance to non-residents when buying real estate in Ukraine:
|Service||What is included|
|Consultations||General issues and features of taxation in connection with the acquisition of real estate in Ukraine by foreigners.|
|Due Diligence||Checking the seller and the object itself.|
|Work with documents||Development of a contract for the sale or lease of real estate.|
|Legal support||Opening an investment account in a Ukrainian bank, presence at the signing of the contract.|
|Other||Registration of ownership of the acquired object, if necessary – the provision of services in English.|
Legal support for the removal of arrests from real estate:
|Service||What is included|
|Consultations||Clarification of the problem in connection with which the arrest was imposed, and the choice of the procedure for its removal.|
|Preparation||Legal analysis of the case.|
|Work with documents||Development of the necessary package of documents, depending on the chosen procedure for removing the arrest.|
|Legal support||Removal of arrests in civil or criminal proceedings, as well as in another chosen order.|
|Other||Registration of removal of arrest in the State Register of Property Rights.|
Legal analysis of the contract of sale of real estate
If you buy real estate on the secondary market, then the transaction is formalized through a notarized contract of sale, and then the ownership is fixed in the State Register of real rights to real estate. The situation with the purchase of housing in a new building is much more complicated. At the time of the transfer of funds by the buyer, the house has not been built, the apartment that is being sold does not yet exist. Until the object is put into operation, it cannot be entered into the State Register of Property Rights. That is, the traditional contract of sale for real estate at the construction stage is not concluded.
For your information! The sale of housing in new buildings by sellers (developers) is carried out under other types of contracts, the conclusion of which has its own nuances, advantages and disadvantages. If you decide to invest in construction for the subsequent purchase of an apartment, it is very important that a lawyer for new buildings carefully analyze the contract under which the housing will be transferred to you. Let’s consider what kind of contract it could be.
The document fixes the seller’s promise in the future (after the completion of construction and putting the house into operation) to conclude the main contract, according to which the ownership of the property is transferred to the buyer. Such a contract for each developer has its own characteristics. However, it is very important to pay attention to the presence and clear wording of such points:
- deadline for completion of construction and signing of the main contract;
- price and full description of the apartment (floor, area, number of rooms, content);
- material liability of the parties for violation of the terms of the contract;
- the grounds and procedure for terminating the contract, in particular, the return of funds, as well as amending the contract;
- the procedure for transferring the apartment to the buyer.
Contract for the sale of property rights
In jurisprudence, property rights mean rights in rem other than property rights. The buyer receives the right to become the owner of the property in the future, that is, when the new building is completed and put into operation. At the same time, the acquisition of a property right is not associated with the commissioning of an object, and the contract itself can be concluded in a simple written form without notarization. Therefore, when concluding such an agreement, one has to rely on the reputation of the developer, which means that it must be checked very carefully.
An agreement stating that in the future the seller (developer) is obliged to provide the buyer (investor) with the rights to the apartment, and the buyer pays for its cost. We are talking about such a legal category as a derivative – a document that regulates the legal relationship between the buyer and the seller in the future.
Forward contracts are registered on the exchange, which is an additional guarantee for the buyer. However, the conclusion of such an agreement involves the participation of a third party – a joint investment institution (JII). The buyer transfers his funds to the ISI, and then this entity enters into a forward contract with the developer.
For your information! For the sale and purchase of real estate in a new building, an agreement on participation in a construction financing fund (CFF), an agreement on the purchase of real estate with participation in a housing construction cooperative, an investment agreement, a share participation agreement, and so on, can also be used. If you want to buy property rights from an investor who has already invested in a new building one by one of the above agreements, then an assignment agreement is concluded.
Important! Contracts under which the sale and purchase of real estate in new buildings is carried out are fraught with many obvious and hidden risks. To reduce the number of such risks, a lawyer is needed: in this case, real estate will become a profitable investment, and not a ghostly dream.
Real estate lawyer: making changes / additions to the contract of sale
If, as a result of due diligence, vulnerabilities and risks are identified in the contract, real estate lawyers of Lawrange JSC can prepare recommendations for their elimination and directly make the necessary additions or changes to the contract.
What exactly can we do?
- we will select up-to-date links to the current legislation in the field of real estate and construction;
- we will take into account the norms of tax legislation;
- we will prepare written amendments or additions to the contract and provide you with clarifications to them.
Real estate lawyer: pre-trial analysis of the case
In the event of a dispute between the seller (developer) and the buyer (investor) or between other participants in legal relations in the field of real estate, we are ready to assess the prospects for litigation.
How can we help?
- we will conduct a legal analysis of the submitted documents;
- calculate the cost of the trial;
- determine the prospects for obtaining the necessary decision in court.
Real estate litigation
Our practice extends to protecting the interests of the client in court in disputes related to real estate and construction. Real estate lawyer JSC Lawrange will effectively perform tasks such as:
- restoration through the court of documents for real estate;
- removal of arrest from real estate;
- recognition of the right or legalization of the property;
- real estate section;
- collection of fines from the builder.
Buying real estate can and should be a profitable investment, the basis for a happy family life or business. However, there are too many risks from sellers and fraudulent activities in the market. To avoid all this, a Lawrange real estate lawyer will be useful. Knowledge of the law and experience will help to bypass the “pitfalls” and offer the client the result he needs.
What is the job of a real estate lawyer?
Firstly, this specialist advises on all matters of buying, selling and renting residential and commercial real estate. Secondly, he is engaged in the development and examination of contracts in the field of real estate. Thirdly, he represents the interests of the client in negotiations, in government agencies and in court.
What is included in a real estate due diligence?
A real estate lawyer checks the object itself, the land on which it is built, title documents, permits (if it is a new building), the seller (developer) and persons associated with it.
How long does a property due diligence take?
Depends on the object that the client plans to purchase. For example, an apartment on the secondary market and a commercial property are two different things. The difference in the cost of the issue is many times. You, as a client, must understand that the priority is not the speed, but the thoroughness of the verification.