Checking An Apartment Before Buying From The Primary Market In Ukraine
Apartments from the primary market interest many people not only as personal housing with new comfortable layouts, but also as a reliable investment. According to experts, investing in the primary real estate market can bring about 12% per annum or 40% as a one-time investment.
But how safe is such an investment?
The most basic fear associated with buying property in the primary market in Ukraine is that having no access to numerous registers, or simply not knowing where to look and how to analyze data, you will never know how reliable a developer is and whether the apartment is safe to buy.
Many buyers rely on the help of a realtor or real estate agent who undertakes to find a suitable property.
But there is an important detail: a realtor does not check, but sells.
Even if you sign a service agreement with such an agency, it will be clearly stated therein that the agency and the realtor are not responsible for the data or information, the provision of which is not their function.
Some people prefer checking the apartment with a notary before buying it. Of course, the notary can check the documents when you sign the transaction. But here it is important to remember that the notary is not responsible for the deliberately false information provided to him. This means that if the documents of the real estate developer are properly prepared, the notary will accept them and your risks will remain the same.
Real Estate Due Diligence is a reliable way to buy real estate safely
You have a clear desire to buy an apartment in the primary market of Ukraine safely and without surprises in the future. That means that you should contact a specialist in this particular area - a lawyer who will be able to quickly check both the real estate developer with whom you will have to sign an agreement, and the new building.
An apartment inspection by our law firm consists of the following stages:
General inspection through open channels.
This is the very first step, which you can also take on your own. However, a lawyer will always double-check and, moreover, know exactly what to look for. By general channels, we mean the real estate developer’s website, reputable real estate resources, the website of the Ministry of Justice and the Unified State Register of Enterprises and Organizations of Ukraine.
If you are only going to start looking for an apartment we can immediately give you a list of reliable real estate developers or select the most reliable one from your list at the initial consultation. This will greatly reduce the time of the follow-up inspection. However, in addition to the real estate developer, you also need to consider its specific project.
Checking the real estate developer’s history.
This stage of the inspection includes an analysis of the history of the real estate developer and its related companies (up to 3 companies), registration documents, as well as a check of arrests, court or enforcement proceedings against the real estate developer or its related companies.
We also check the register of debtors and the register of court decisions. However, just checking the information is not enough; it must also be analyzed and risks assessed.
The analysis of the real estate developer’s history allows us to understand its reliability and the absence of unpleasant moments in the past. In addition, real estate development often involves another General Contractor, design company, investment company, etc. This is due to the peculiarities of the legislation in this area.
You may also like: How Can A Foreigner Buy An Apartment In Ukraine
Checking the land plot used for a newly-built building.
This is one of the most insidious issues to check, but also one of the most important when buying real estate.
The fact is that to be fully convinced of the reliability of the transaction, it is not enough to have the real estate developer’s documents for the right to use the land. Because it can be leased as a communal property. And thus, you need to find out the lease terms and conditions and whether they are suitable for you, i.e. whether they do not carry any risks for you.
Another possible risk is that the land may not have the desired purpose. It is necessary to check it through the cadastral registry (cadastral map of Ukraine). The wrong land purpose can later result in failure to sign a contract with the utility service providers, to register your place of residence, etc.
Analysis of building permits.
We check the availability and completeness of the real estate developer’s mandatory documents for construction. It is easier to do this with our experience, because one of our practices is to obtain licenses and other construction permits. We know all the ins and outs of the process, so we know what to check in the first place.
We check the terms of construction, as well as the timing and order of connection of communications, on which you will receive the information you need.
Analysis of the real estate purchase agreement.
If the real estate developer has successfully passed our thorough inspection, we proceed to the analysis of the provisions of the agreement for the transfer of ownership rights to the apartment to you, depending on the type of agreement you want to conclude: investment agreement, forward contract, purchase and sale agreement, etc.
We begin with the analysis of the scheme offered by the real estate developer. Then we analyze the agreement in detail. At your request we can also propose necessary amendments. In our practice we have had situations where the real estate developer and the general contractor had an impeccable reputation, but the investment company with which the contract was signed, as it turned out during the inspection, was part of a group of companies of a former deputy who is no longer in Ukraine. In this regard, we had to outline the great risks of not getting an apartment.
Of course, our lawyer can fully prepare or check all the documents for concluding the transaction at the notary. The transaction can be conducted with our proven notary partner.
Today, there are many companies on the legal market offering such services. Why should you choose us?
So, we offer you:
Extensive inspection. Having experience obtaining various construction documents and communicating with many real estate developers, we know exactly what and where to look for.
Simplicity. Checking an apartment with us means getting what you want in just a few taps. We will check and prepare everything for the deal ourselves, taking care of your safety.
Comprehensive consulting. Our law firm not only has construction and land law specialists, but can also provide you with all the information on taxation of your purchase and opportunities to invest your money in the best possible way.
Advantageous packages. We have developed service packages, so that you can find the one that suits you best in terms of price and range of services. Please follow this link.
Do you want to buy an apartment or a house in Ukraine safely? Don’t hesitate to contact us! Buying a property in Ukraine with us is a deal in three taps: make an order, send the information about the desired apartment and sign the housing documents. We will do the rest!
Do you want to know more?
All information about buying an apartment in Ukraine.
Find more information about buying an apartment in Ukraine by a foreigner here.