Buying an Apartment in the Secondary Market in Ukraine: Inspection, Preparation for the Deal
The choice of buying an apartment in the secondary market in Ukraine, that is, real estate that has already been in the use of at least one owner after the real estate developer, may be due to different reasons. Many people choose such real estate because of the rapid access. No need to wait for the end of construction or repair - you can move in almost immediately.
Some people want, for example, to buy an apartment in Kyiv, Lviv or Odesa in a particular area where there may be no new buildings, if we are talking about the historic center of the city.
Anyway, buying an apartment in the secondary market has both its advantages, and pitfalls:
There may be underage children registered in the apartment. In this case, you can buy the apartment, but you will not be able to de-register children from there without their consent;
The apartment can have a prohibition on alienation, which you may not know about, or for example, be in a pledge.
The apartment can belong to several people, and here it is important to take into account all the shares, put them together and get the consent of all owners of the apartment;
The owner of the apartment may be an incapacitated person, and his/her relative tries to sell the apartment, assuring that you will have no problems.
As you can see, the main problems are related to the history of the apartment and the identity of the owner. It is also important to properly execute the purchase and sale agreement and the preliminary agreement (prepayment agreement), if you want to buy an apartment and use it.
It is very easy to avoid problems - we offer you a professional check of the entire history of the apartment, as well as the organization of the purchase and sale transaction with our partner notary.
You may also like: How to Return the Pension Fund Fee for the Purchase of Housing?
Legal advice on the purchase of an apartment in the secondary market in Ukraine
If you still have doubts about whether it’s worth buying an apartment in the secondary or primary market, and you want to understand the procedure of transferring the ownership right to the property and how to protect yourself in the process - don’t hesitate to contact us for a consultation with a real estate lawyer.
Please note! When you order any of our packages of support services for buying an apartment in Ukraine, the consultation and preliminary inspection of the property will be included in the service price.
If you only want to check the apartment, and to conduct the purchase and sale procedure on your own - you can see the price of the preliminary inspection of property in Ukraine here.
Rules for buying an apartment in the secondary market in Ukraine in 2021
Let’s briefly go over the basic rules of buying real estate in the secondary market of Ukraine. By following these rules and using the tips, you will be able to ensure the safety of the transaction. If you want to get a 100% guarantee - we are ready to help you.
Checking the real estate object.
The first step of checking the apartment in the secondary market is to determine the owner of the apartment. The seller of the apartment can be a relative with a power of attorney, but you need to get to the heart of the issue - in the perfect case, you should to contact the owner, to clarify whether he/she intends to sell the apartment and to make certain that the owner has authorized the seller to make the purchase and sale transaction.
The owner of the apartment shall be checked for being in the register of debtors, a party to the lawsuit, in the register of alimony debtors - all these might be red flags.
The next step is to check the documents on the apartment:
Demand only original documents confirming the ownership rights to the apartment;
Check the right of ownership in the State Register of Property Rights to Immovable Property - in the ideal case, you should get a certificate;
Technical data sheet of the apartment.
In addition to this register, you should check the Register of Court Decisions, which will show whether the apartment is the subject of a dispute. It’s also worth contacting the Administrative Services Center to find out how many people are registered in the apartment, and whether any of them are minors or temporarily de-registered.
In this case, the Unified Register of Debtors will also help you find out whether the property has any debts for public utility services. We also check the State Register of Encumbrances on Movable Property.
One of the important points of inspection is to check for uncoordinated alterations in the apartment. This issue can be checked with the Technical Inventory Bureau.
Since we are talking about buying an apartment in the secondary market, which means the house can be in operation for several years, it is important to pay attention to the technical condition of the apartment: pipes, mold, electricity. The easiest way is to ask your neighbors. You can also look for information on forums and review sites.
Learn more about how to check the primary property here.
Review of the agreement and arrangement of the transaction at the notary.
Particular attention should be paid to the proofreading and drafting of the apartment purchase and sale agreement.
The agreement must be signed at the notary. Our lawyer will review its content and all the additions “in small print”. It is important to specify the subject of the agreement, the amount, the prepayment return conditions, if any, and many other nuances.
Please note! If the apartment has several owners, you will need a notarized letter of consent from each of them. If the owner is a minor - the deal can be done only with the permit of the local agency of guardianship and custody.
Transferring money for the apartment.
Money transfer for the purchase of the property should be done only through a bank account and in the national currency - hryvnia.
Yes, the seller can ask for dollars, yes, your friends can say: “Yes we did it, everything was fine”. It doesn’t mean that if someone got away with it, you will be as lucky.
Money transfers must be made through a Ukrainian bank. As for the amount, money transfers of UAH 250,000 and more may fall under financial monitoring, but our lawyers will advise you on the correct process of transferring the money for the apartment.
Saving on taxes when buying an apartment.
When buying an apartment in Ukraine, you will have to pay tax to the Pension Fund of Ukraine at the rate of 1% of the amount of the transaction.
There is a fairly common scheme, when the preliminary assessment of the property (the notary will not certify the transaction without it) specifies the deliberately underestimated value of the apartment. They say let’s indicate the lower price to reduce the amount of tax.
Such a scheme is fraught with serious consequences, especially if you have not checked the apartment or its owner thoroughly enough. We have seen examples when after the conclusion of the transaction at two or three times understated price, for example, an incompetent relative appeared, which owned a part of the apartment, and the agreement was declared invalid. In this case, you will be returned only the amount specified in the agreement - that is simply a fraudulent scheme.
Of course, you can sue, but to prove your case with a signed agreement specifying a clear amount will be very difficult.
Please note! If you are a citizen of Ukraine, and you buy a home for the first time - the miserable 1% Pension Fund fee can be returned. Read about how to do this here.
Further sale of the apartment.
When buying an apartment, remember that it is better to wait with its subsequent resale. If you want to sell the apartment in less than three years after buying it, you will have to pay an extra 5% tax on the value of the apartment if you are a resident of Ukraine, and 18% tax - if you are a foreigner.
Legal services for buying an apartment in the secondary market in Ukraine
Realizing the complexity of the procedure and knowing exactly how it works in practice, we offer our services to those Clients who want to be confident in the security of buying property in Ukraine.
Our company’s lawyers provide the following range of services for buying an apartment in Ukraine:
Advising on the process of buying an apartment in the secondary market in Ukraine, suggesting the best algorithm of actions;
If you are a foreigner - we will obtain you an identification code and help you to open an account in a Ukrainian bank;
Pre-sale inspection of the apartment in the secondary market;
Checking the apartment purchase and sale agreement in Ukraine;
Arrangement and support of the apartment purchase and sale transaction with a proven notary.
Contact us, tell us about your needs, and we will offer you the best package of services. Buying an apartment with us is easy and safe!
Do you want to buy an apartment in the secondary market in Ukraine? Don’t hesitate to contact us! We will check the history of the apartment and make sure that the transaction runs without problems.
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