The preparation of the purchase agreement entails several pitfalls that can jeopardize or at least slow down the entire transfer. In this series on the purchase contract, we will try to unmask these pitfalls and give guidance on how to avoid them.
The preparation of the purchase agreement entails several pitfalls that can jeopardize or at least slow down the entire transfer. In this series on the purchase contract, we will try to unmask these pitfalls and give guidance on how to avoid them.
Today, we are looking at the issue of the definition of real estate in the contract of sale. This blog concerns an apartment, house or land.
The law no longer uses the term immovable property but speaks generally of immovable property. However, it is not a problem if you define the subject of the purchase in the contract in any way, the terminology just needs to be consistent. Therefore, if you talk about immovable property in the beginning, it is not a good idea to use the term “flat” in the middle and mention immovable property at the end. This can lead to interpretive confusion later on and sometimes even to unpleasant disputes.
The law also knows other terms, which can be confusing. A dwelling is a spatially separated part of a house used for living purposes, whereas a housing unit is an immovable thing which includes, in addition to the dwelling, a share in the common parts of the house. It is the share in the common parts of the house that can often be mistaken and it is therefore always necessary to check the current status registered in the Land Registry before selling.
Your apartment may not have changed, but if the apartments on another floor have been merged, for example, the share in the common parts of the house of all owners will change. We have recently come across a case where a mistake was made by the bank (when registering the mortgage) in the definition of the common parts. This also complicated and prolonged the transfer of the apartment into our client’s ownership.
We provide a complete package of legal services related to real estate sales and purchases, including reservation contracts and escrow services. We will also help you with all tax and land registry issues. Our work is fast and accurate, ensuring a worry-free transaction. You’re also welcome to pay after services are provided.
In the contract as well as in the application for registration of the change of ownership, the property should be defined precisely and identically in all details. Always start from the entry in the Land Registry. A minor mistake can result in delays in the proceedings and thus often jeopardise the entire operation or introduce the cause for a long dispute.
Do not forget also to define all the components of the property being transferred. The contract of sale may also be accompanied by a fairly detailed annex, especially in a situation where a house and surrounding land with amenities are being transferred. Definitely do not rely on a verbal agreement with the other party. It is always better to write everything down clearly, concisely and factually to avoid misunderstandings and bad blood. In fact, disputes often arise where there was no malicious intent, just ambiguity that someone will later take advantage of.
Download the free e-book 5 Tips to Buy or Sell Real Estate Risk-Free and go smoothly through the process of selling or buying a house, condo and land.
We provide a complete package of legal services related to real estate sales and purchases, including reservation contracts and escrow services. We will also help you with all tax and land registry issues. Our work is fast and accurate, ensuring a worry-free transaction. You’re also welcome to pay after services are provided.
Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.
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