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Apartment Inspection Before Purchase
How to Check an Apartment Before Purchase: A Step-by-Step Guide from Experts
Purchasing an apartment is a major financial step in every person’s life. The search for housing is influenced by numerous factors that must be taken into consideration to find the best option. Among these factors, it is crucial not to overlook the legal aspects that can significantly affect your investment.
Legal due diligence of an apartment before purchase is an essential part of the property acquisition process. Not only does it help you choose the safest property from a legal standpoint, but it also allows you to avoid risks that may arise during future ownership.
Experts at the Dominion Law Firm help clients check real estate on a daily basis and know exactly what to look for to avoid all possible risks.
In this article, we offer a step-by-step guide on how to check an apartment, supported by real-life examples from practice that will help you avoid mistakes in the process of buying a home.
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Why Is It Important to Check an Apartment Before Purchase?
- To ensure the legal integrity of the purchase
- To protect yourself from fraud
- To avoid financial risks
- To prevent potential problems during future ownership
How to Check an Apartment on the Secondary Market
1. Document Verification
Begin by analyzing the title documents. It is based on these documents that the state registration of ownership is performed. A title document may be single for the entire apartment, or there could be several if ownership was acquired through different means or if the apartment has two or more owners.
Below are some of the most common types of title documents confirming apartment ownership:
- Contracts for Sale, Exchange, or Donation. These contracts must be notarized and issued on special notarized forms. Ownership rights based on these documents must be registered in the official register, which is confirmed by an extract from the State Register of Property Rights to Real Estate or by a registration note in the body of the contract. A sale agreement is the most common option, where the seller transfers the property to the buyer in exchange for monetary compensation. An exchange agreement involves swapping real estate between parties, and a donation agreement stipulates the transfer of property free of charge.
- Certificate of Ownership. These certificates were issued by registration authorities of the Ministry of Justice of Ukraine from January 1, 2013, to January 1, 2016, and confirmed the acquisition of property rights to real estate after its state registration.
- Certificate of Inheritance. This document confirms ownership obtained through inheritance (by law or by will) and is issued separately to each heir. It is important to verify the existence of any other heirs and review information in the inheritance register.
- Certificate of Privatization. This document confirms the transfer of the apartment from state ownership into private ownership. It is important to check that all family members who had the right to privatize the apartment participated in the process since that can affect the legitimacy of the ownership right.
Other documents can also confirm ownership, such as a court decision, a property division agreement, or a stock exchange transaction. If you come across such documents, we strongly recommend not to skip hiring a lawyer when buying an apartment. These documents require a thorough analysis, as they may contain hidden risks for the buyer.
2. Checking Information in Registries
Ukraine has made significant progress in digitalization and the development of e-government services, allowing us to verify information about real estate via electronic registers.
Which registries should be checked before buying an apartment?
- State Register of Property Rights to Real Estate. This register provides information about the owner(s) of the property, as well as encumbrances, mortgages, and arrests. The presence of such records can hinder the purchase. Dominion Law Firm has extended access to this register, allowing for a detailed analysis of the property’s history and information about previous owners, thereby reducing the risks when buying.
- Single Register of Debtors. This register should be used to check all apartment owners. It is also essential to verify the spouse if the real estate seller is married. If the owner (or co-owner) of the apartment is listed as a debtor, the sale of such a property would be illegal.
- Territorial Community Register. Many communities have electronic registers containing data on the place of residence of individuals. To confirm that no one is currently registered in the apartment, you should obtain an extract from this register. Make sure that no children are registered in the apartment.
- Unified State Register of Court Decisions. If the apartment was previously involved in a court dispute, information about it should be in this register. However, personal data and property addresses are concealed, so it is crucial to verify properly to ensure that there are indeed no court cases involving the apartment you are interested in.
Specialists at Dominion Law Firm utilize all available government registers to obtain key information during the apartment-checking process. Specifically, we verify property owners’ passports through the services of the State Migration Service and analyze data from the State Sanctions Register. If needed, we obtain information from the State Register of Civil Status Acts and the Register of Enforcement Proceedings, among others. Thanks to thorough checks in all registers, we are confident that no crucial detail will go unnoticed during the transaction.
3. Checking the Technical Condition of the Apartment and Additional Documents
Legal services for buying an apartment typically do not include checking the property’s technical condition since this is the domain of a professional builder or engineer. Such specialists can detect hidden problems that may require significant repair costs in the future.
However, based on our many years of experience in real estate, here are several tips on what to look for when inspecting the apartment:
- Engineering Networks. Before buying an apartment, make sure the engineering systems are in good working order, as they can significantly affect comfort and future expenses. Defective water supply, heating, or electricity systems are serious issues and can lead to high repair or reconfiguration costs. In one of our cases, clients nearly purchased an apartment with underfloor heating illegally connected outside the water meter, which could have led to additional penalty charges from utility services.
- Meter Accuracy and Utility Debts. Be sure to check the accuracy and calibration documents for any meters in the apartment. Malfunctioning meters can lead to overpayment for utilities in the future. Also, verify there are no outstanding utility debts, as such debts may cause complications when re-registering contracts under the new owner’s name.
- Unlawful Redesign or Remodeling. To avoid issues with unauthorized renovations, carefully inspect the apartment to ensure that its actual layout matches what is shown in the technical passport. If illegal renovations are discovered post-purchase, the new owner would be responsible for them.
The technical passport is a document containing information about the apartment’s technical characteristics, square footage, layout, details regarding construction materials, and engineering communications. It is issued by municipal BTIs (Bureau of Technical Inventory) or certified technical inventory engineers.
In summary, verifying the apartment’s title documents, analyzing the information in government registers, and confirming the apartment’s proper technical condition are three essential steps before buying. If you have difficulties independently checking every nuance, we are here to help. Hiring a lawyer when buying an apartment ensures peace of mind and confidence in a safe transaction.
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How to Check an Apartment in a New Building
Buying an apartment in a newly constructed building offers many advantages for buyers, such as modern layouts, new engineering systems, energy efficiency, and well-maintained adjacent territories. New buildings are also an excellent investment choice, as they can yield increases in property value. However, do not forget about the risks associated with losing money or not receiving the desired square footage if the construction is illegal or the developer acts in bad faith.
Therefore, before purchasing an apartment in a new building, you should thoroughly check the following:
- Land Rights, Urban Planning Requirements, and Land Plot Restrictions. Verify the developer’s rights to the land plot. For the construction of multi-apartment buildings, the developer must own the plot or have a lease, permanent use, or a superficies agreement. The land’s designated purpose must allow for residential construction. For lawful construction, the developer must obtain urban planning conditions and restrictions, which set acceptable types of structures and define requirements such as height, floor area, and distance from neighboring properties.
- Building Permit, Project Documentation, and Project Expertise. A building permit is a mandatory document confirming the legality of the construction. The project documentation must comply with national construction standards, and an expert examination of the project is required for the construction of multi-unit residential buildings.
- Construction Participants and Their Contracts. It is important to check the construction customer and the developer, as well as analyze information about them in the registers. You must also check the general contractor, who should have a special license to perform construction work. Large complexes often involve investors who contribute funds and receive part of the future building’s space once it is completed. Therefore, it is essential to scrutinize all agreements among construction participants and any space allocation documents.
- Technical Conditions for Connecting Engineering Communications. Technical conditions (i.e., specifications) for connecting water, electricity, and heating are critical to ensure the building’s functionality. These confirm the technical feasibility of connecting the construction site to relevant utility networks and that all technical details of the connection have been approved.
- Documents Confirming the Building’s Readiness for Operation and Assignment of a Postal Address. After construction is completed, the developer must obtain documents confirming the building’s readiness for operation. For multi-apartment buildings, this means obtaining a Certificate of Readiness for Operation, which attests that the building meets all required standards. Once the building is put into operation, it should be assigned a postal address — a mandatory step for registering property rights.
- Developer’s Reputation and Information on Previous Projects. A developer’s reputation is a vital factor when choosing a newly built home. Pay attention to reviews of previous projects, their quality, and whether they were completed on time. Information about successfully executed projects helps you gauge the developer’s reliability and make a well-informed choice when purchasing an apartment in a new building.
Selecting a legally safe property on the primary market requires thorough inspection and analysis of many important aspects. Buying a new-build apartment is a significant financial investment, so having an attorney in Kyiv review the documents is a must. This ensures a secure transaction and helps you avoid potential problems in the future.
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Real-Life Examples: Why Checking an Apartment Can Save You from Serious Problems
Every day, our experts help clients avoid high-risk transactions. Here are a few typical scenarios from our practice.
Сase #1
During an apartment inspection before the purchase, it turned out that the seller had received the apartment as a gift from his son less than a year prior. Upon analyzing the Unified State Register of Court Decisions, we discovered that the son’s former wife had filed a lawsuit claiming that the apartment was part of their marital property. Therefore, the son hastily transferred the apartment to his father by donation, and the father is now trying to sell it at market value.
Buying this apartment posed a serious risk for our client, as the donation agreement between the son and father was not intended for a genuine transfer of property but rather to conceal the asset during divorce proceedings. The court could declare this agreement invalid and recognize the apartment as jointly owned property to be divided fairly between the spouses.
If our client had purchased such an apartment and the ex-wife of the previous owner (the son) then filed a court claim to invalidate the donation agreement, all subsequent transactions, including the sale contract, could also be deemed invalid. In such a scenario, our client would risk losing the apartment and would have to seek reimbursement through the courts — a potentially lengthy and complex process.
Case #2
Here is another illustrative case: An apartment on the top floor of a multi-story building turned out to be the product of an illegal reconstruction of a technical room. At first glance, the paperwork appeared completely legitimate, especially since this was not the first time the apartment had been sold.
However, a detailed analysis of the property’s history revealed that the first owner, lacking any permits, had illegally subdivided a large technical room into several apartments, which he then sold. This unauthorized reconstruction led to a criminal investigation for unlawful actions. During the pre-trial investigation, there was a real threat that the authorities would order the premises to be restored to their original state.
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Conclusion
For many people, purchasing an apartment is one of the largest and most significant financial investments in their lives. This is why hiring a lawyer when buying an apartment is a crucial guarantee of a safe transaction. A thorough inspection will help you avoid legal problems, hidden technical issues, and unforeseen expenses.
Do not risk your savings — entrust the verification process to professionals. The Dominion Law Firm team is ready to protect your interests at every transaction stage. Contact us now for a free consultation and learn how to make your apartment purchase as safe as possible.
