Selling an older house – 9 things to watch out for

Each property has its own specifics, which must be taken into account when selling it. For an older house, different details will need to be taken care of than for a new build. How exactly to proceed when selling such a house and what to remember in the contract? This is what we will discuss in the following article.

Starší dům k prodeji
9 minutes of reading

Chapters of the article

  1. Check whether your house is listed
  2. Expert opinion and property price
  3. An inspection of the technical condition of the building will also be useful
  4. Beware of liability for hidden defects
  5. Don’t forget the energy performance certificate
  6. What about co-owners’ pre-emption rights?
  7. Restitution claims can bring complications
  8. Easements
  9. Demolition of the building and construction of a new building

The procedure for the sale itself will be the same as for any other house. For an older house, it will be more about the minor differences that need to be addressed in the contract or the actions that should be taken in connection with the sale.

Check that your house is not listed

Whether you’re selling an older house or, conversely, are interested in buying it, it’s always a good idea to find out where it stands in terms of conservation and, where appropriate, nature conservation. Not only the building itself, but also the site in which the building is located may be protected, which means several restrictions for you. These often relate, for example, to the way the property is used or its possible renovation, which you will need to consult with the relevant authorities.

This information should therefore be disclosed by the seller to the potential buyer in good time, as it can significantly affect the whole sales process and concealing it would only bring a number of complications. At the same time, the buyer should take an active interest in this information and verify it not only with the seller, but also with the Land Registry.

Expert opinion and property price

When selling a property, it is of course time to determine the sale price. This can be determined by a market appraisal, which is most often carried out by a real estate agent or other property appraiser. Alternatively, an expert’s report, which was previously required for the needs of the tax office, is now completely at the discretion of the seller. In the case of the sale of an older property, however, the preparation of an expert’s report is more than advisable for several reasons.

A valuation report examines the property in more depth than a market appraisal. An appraisal that can only be prepared by a court-appointed expert will examine the technical condition in more detail, which is certainly desirable for older properties. The register of court-appointed experts is freely available for inspection. Simply choose a particular expert according to region and specialisation and contact him.

It will also be useful to check the technical condition of the building

In addition to an expert’s report, a property inspection will also check the technical condition of the building, which, in the case of an older house, we can only recommend. This time, the property is no longer inspected by an expert witness, but by an inspector certified by the Association of Property Inspectors. The inspector will focus on checking for hidden technical defects and will help not only to identify the causes, but also to advise on their removal. Not only the seller but also the buyer can use the services of the inspector.

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Beware of liability for hidden defects

Older properties are very specific, and even after a thorough inspection, over time certain defects can be discovered that could potentially go to the seller. As a result, contracts often rely on the claim that the property is being sold “as it stands and lies”. Ideally, this would mean that the seller would not be liable for undiscovered defects – but only if he has made efforts to discover them, informed the buyer of any defects found and not concealed anything.

Unfortunately, this provision cannot be applied in the case of real estate, as it does not apply to individually determined items. In the case of the sale of real estate, this condition can only be invoked if the buyer waives in writing his or her right under the defective performance. Otherwise, the seller is always liable for any latent defects.

Therefore, it is worthwhile to prepare an expert’s report and check the technical condition of the building – only in this way can the seller detect any defects in time and avoid inconveniences that would mean not only time but also a significant financial loss.

For the buyer, this procedure also means the assurance that the house is in good condition and that there will be no need to deal with a lengthy and rather demanding withdrawal from the contract. The preparation of an expert’s report and a technical condition check is thus in the interest of both parties to the sale of the property.

Buyers can also use the services of specialist companies to help with the assessment of the condition of the older house and the subsequent reconstruction plan. One of these companies is Perlík Projection with operations in Prague and Central Bohemia.

Don’t forget the energy performance certificate

Before the sale of the property begins, it is necessary to obtain a building energy performance certificate (PENB). This indicates the efficiency of a building on a scale from A to G, where A indicates the most efficient building, while G indicates an extremely wasteful building.

Since 1 June 2015, all sellers, except those offering for sale,have been required to have a PENB (building energy performance certificate):

  • buildings of up to 50 m2,
  • properties built before 1947 that have not undergone significant renovation since then,
  • cottages or other buildings intended for recreation,
  • buildings without a description number.

In the case of the sale of a house, the obligation to present a certificate almost always applies, the only exceptions being transfers without consideration or transfers under inheritance proceedings.

The seller should present a valid certificate to the buyer when selling the contract, but should already state the energy performance of the building in the sale advertisement.

The certificate, which will be provided by an energy specialist accredited by the Department of Trade and Industry, is valid for ten years. However, if during this period the property is significantly remodelled, which will also affect its energy performance (typically, for example, new insulation or installation of solar panels), a new PENB should be prepared.

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What about the co-owners’ right of pre-emption?

If the seller is only one of the co-owners of the property he is going to offer for sale, he should keep in mind the right of pre-emption. Although it has been almost completely abolished as of 1 July 2020, there are a few exceptions to bear in mind when selling a property.

These are mainly cases where the property has been acquired by joint ownership in the context of inheritance proceedings (in such cases, the right of pre-emption expires only after six months). The second exception is the statutory right of pre-emption in favour of the owner of the land in respect of another’s building on that land and vice versa.

Tip: We have devoted a separate article to pre-emption rights, where you will find everything you need to know.

Restitution claims can bring complications

Unresolved restitution claims are often associated with the sale of older houses, as they can cause a lot of trouble for the new owner. If there are outstanding restitution claims after the transfer of the property, the new owner may even lose the property. Therefore, in certain cases it is advisable to resolve any claims before the purchase.

The seller should provide not only an extract from the title deed, but also documents from the land office. It is in the buyer’s interest to be really careful in this respect, because it may not always be easy to trace any restitution claims. It is necessary to cooperate with the cadastral and land office.

Easements

Older houses are often encumbered by a number of easements. Some are quite harmless, but others can be quite a significant obstacle to the sale itself. Among the easements that are not to be worried about are the classic utility easements (in favour of water, power or gas utilities).

There may also be encumbrances registered in favour of neighbours. In practice, we often encounter, for example, the right to use a driveway running through the property.

However, sometimes we also encounter easements that directly affect the use of the property. A typical example is the easement of lifetime use of the property. This is most often established for the benefit of the parents who pass the property on to their children. Easements are registered directly in the Land Registry and, unless otherwise specified, do not terminate on sale or other transfer of the property.

In the case of easements, there are often some really curious things. In the law governing the easement of paths, passes and roads we read, among other things:

  • A trail easement does not include the right to ride animals onto the easement land or to haul burdens across the easement land.
  • The grazing right extends to all kinds of livestock, but not to pigs and poultry. Animals that are excessively dirty, diseased or strange are excluded from grazing.
  • The right of way easement confers the right to drive any vehicle over the easement land.

Demolition of the building and construction of a new building

The last point will be of particular interest to buyers. Many of them buy an old house with a view to its removal and subsequent construction of a new dwelling. Paradoxically, land with an older building is often cheaper than empty building plots. This step can be complicated in cases where the house is in a terraced development, adjacent to other buildings or is a semi-detached house.

If you decide to take this step, you will first need to sort out the application and design to remove the structure. It is certainly not worth bypassing the authorities, as the subsequent fines can run into hundreds of thousands of crowns. The disadvantage here compared to reconstruction is the longer bureaucracy.

To obtain a building permit, you will need to submit an application for demolition to the building authority, which must include the written consent of all neighbours. In some cases you may be required to submit a demolition plan.

You should then entrust the demolition to a company that will issue a certificate of professional execution. The certificate must then be delivered to the building authority to comply with the notification requirement. The Building Authority will then issue a certificate to the Land Registry, which will result in the removal of the building from the Land Registry. Only then can you apply for the location of the new building and the building permit.

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Author of the article

JUDr. Ondřej Preuss, Ph.D.

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.

Education
  • Law, Ph.D, Pf UK in Prague
  • Law, L’université Nancy-II, Nancy
  • Law, Master’s degree (Mgr.), Pf UK in Prague
  • International Territorial Studies (Bc.), FSV UK in Prague

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