Buying an apartment in a new building. Step-by-step instructions 2021

To choose a reliable developer, you need to check land documents, building permits and find out how the project will be financed. To check reliability, you can use questions from our expert - Alexey Shilov, head of the sales group of the Nekrasovka Quarter project.

You can copy the questions and take them to your meeting with the developer:

• Do you have bank accreditation?
• How many houses have you already built?
• How is construction financed?
• Where can I see land documents?
• Can I see your financial statements?
• Do you have a conclusion on compliance with the requirements of 214-FZ?
• Will we be able to use the secure payment service?
• Will my money be held in escrow accounts?
• What will we do if the deadline is delayed?
• What will be built nearby in the next five years?

Here are the answer options that should suit or alarm you.

Stage of completion of the house

This is a very important indicator. Despite the documents and positive reputation of the Developer, the house may not be completed.

How to assess the readiness of a house? If the seller claims that the house is completely ready and communications are connected, then it is better to verify this in person. Ask the seller to demonstrate that there is light and water - this is the best evidence. If this is not shown to you with reference to external circumstances, then you can come to the construction site on another day without being accompanied by the seller and ask the builders about whether electricity, water, and sewerage are connected to the house. Since workers, as a rule, are not instructed in how to communicate with clients, they can tell you all the problems of the development. You also need to register on a forum dedicated to building a house, where these issues have already been discussed. Moreover, from communicating with other shareholders, you will learn about other problems of a new building before buying an apartment. If the house is almost completely ready in your unprofessional opinion, but there is no water and light, then this is also a significant risk. Many new buildings wait years for communications.

Attention, neighbors!

This information is relevant for those who choose an apartment in an already rented and partially occupied new building. Very relevant. Many people underestimate this parameter, but in vain - if you are unlucky with your neighbors, then the joy of buying a long-awaited living space can turn into endless everyday problems and “frayed” nerves.

How to identify good neighbors? There are some tips:

• evaluate the front doors of future neighbors - they can indirectly characterize the people living behind them;
• look at the appearance of the windows in the entrance, frames, curtains - based on their condition, we can conclude that the apartments are comfortable;
• The most effective way is to get to know each other. Direct acquaintance with potential neighbors will dot the i’s;
• by walking around the yard and the immediate surroundings, you can understand whether suspicious individuals are gathering in the area or whether everything is quite calm.

What kind of agreement will you enter into?

When purchasing an apartment, check the documents of the new building for all pitfalls. If it is an agreement for shared participation in construction (hereinafter referred to as DDU) and if it is registered with the registration service, then this is a big plus. DDU agreements have priority over preliminary and other agreements not provided for by 214-FZ. In accordance with the above law, if the developer goes bankrupt, your claims will be secured by collateral. DDU also allows you to protect yourself from double sales of the same apartment. If a developer works under DDU agreements, this automatically means that the developer has a construction permit, the issue with the land has been resolved, and other documents are in order with such a developer. Many developers first sell apartments under preliminary agreements, and then, when the documents are in order, they re-register all agreements as DDU. Whether or not to agree to such conditions is, of course, up to you. All other agreements undoubtedly carry more risks than the DDU agreement, but I would not blindly believe that the DDU removes all risks. Many defrauded shareholders entered into DDU agreements, and also many happy owners of apartments purchased them using all sorts of semi-legal schemes. Having a DDU agreement is undoubtedly a plus, but not the only evaluation criterion!

Will my money be held in escrow accounts?

Starting from 2021, developers receive money from shareholders not directly, but from an escrow account and only after the first apartment in the building is delivered. This is how the law protects buyers: if something goes wrong, they will get their money back, and the developer will not be able to say that there is no money.

You can also ask which bank holds the escrow account. And then ask the bank if it is possible to open an escrow account by proxy - there is such an opportunity, and if the bank says that it is not possible, this will mean that it still has little experience and the transaction may be delayed.

Is the new building accredited by the bank?

How many banks issue loans for this property? If no bank lends, this may indicate problems for the developer. It is better if several banks lend to the property, and not just the bank that lends to the developer himself. It will also be an additional advantage if the main lender of the development is a “Top Bank” with good financial resources. If there is not enough money to complete construction, reliable banks will prefer to additionally finance the developer rather than freeze construction. After all, if the developer goes bankrupt, the bank risks not getting its loan back. Having accreditation from a reliable bank means that the bank, when deciding whether to accredit the developer or not, has already checked all the necessary documents. But I would not raise this argument to the Absolute. In practice, I know of at least 100 cases where developers were accredited by certain banks, but problems still occurred. It is important that the accreditation is recent, valid and the bank is from the top 30. It is even better to understand the true reasons for accreditation of a new building. There are situations when the bank is forced to lend to the developer in order to save the assets previously invested in this developer. Without an analysis of the developer’s financial documentation, I would also not blindly believe in this indicator.

Property location

• Location of the house: the house is located “on the outskirts” or in an elite quarter. The presence of a nearby transport interchange plays an important role.
• The quality of construction of the facility: project, year of construction, quality of building materials, etc.
• Availability of parking space, concierge, elevator, storage room.
• Characteristics of the living space: kitchen area, type of bathroom, ceiling height, number of rooms, presence of loggias or balconies, floor.

If apartments are sold with renovations from the developer, then their price is higher than the cost of a similar apartment without finishing. Pay due attention to the appearance of the surrounding area. If green spaces are visible from the window, then the cost of such an apartment is much higher. Accordingly, if the windows overlook garbage cans, then the cost is significantly reduced.

Reputation is worth a lot

Pay attention to how many houses the developer has built before. Were there any problems and what kind of problems during the construction of other real estate projects? Who is behind the developer? If it's an influential political figure, what are the chances that it won't be removed before the house is built? It’s good when the developer is backed by a reliable company with a good reputation. Many companies register a new legal entity for the construction of a new house in order to minimize risks. It is necessary to check who the founders of this legal entity are. See how to do this here.

How many houses have you already built?

The likelihood that a company will complete construction of a house without any problems is higher if it has already built and commissioned several residential complexes. Of course, the developer’s first home can also be problem-free, but companies with a reputation are more reliable.

After the answer, it’s worth checking the developer and googling something like this: LCD “Lyubov” problems, LCD “Votvaga” shareholders, LCD “Nadezhda” cons.

Evaluate the property from an investment point of view

How is assessing the attractiveness of a property related to the legal verification of a new building and the developer? At first glance it doesn’t seem like it, but there is undoubtedly a connection. The construction of a new building in most cases is still a financial pyramid, the construction of which depends on whether new equity holders will buy apartments in this building or not. If not, then there is a very high probability of getting a long-term or unfinished project. And investment-attractive properties, as a rule, do not have problems with financing.

Before purchasing, pay attention to the location of the new building, the availability of free parking spaces, landscaping, the presence of kindergartens, schools, and shops nearby; transport accessibility of the house, assessment of the entire microdistrict as a whole (proximity to a highway, railway, cemetery, hypermarkets, parks and other objects). Compare the property you are purchasing with the property under construction in your chosen area.

It would not be amiss to evaluate the layout of the apartment, the quality of the property itself, namely: ceiling height (the higher the ceiling, the more comfortable and easier it is to breathe), the thickness of the walls (thin walls can freeze), the location of the elevators (if they are adjacent to the living room or elevator shaft, then extraneous sounds will penetrate), the location of windows (view characteristics), the thickness of the floors (affects sound absorption), location on the floor (the first and last floor are usually more difficult to sell, the higher, the better the view, cleaner air, and quieter, but the problem , if the elevator breaks down or if you need to lift a large item into the apartment), etc.

If a new building is being built using monolithic construction technology, then construction delays are possible due to the peculiarities of such construction. Panel housing, as a rule, is built faster and there are fewer construction delays there than in a monolith.

What will be built nearby in the next five years?

It is important for residents of houses that a school, kindergarten, park or hospital be built nearby, but for some developers it is more profitable to build another high-rise building. Therefore, it is better to find out in advance what plans the company has for the nearby territory.

You can check the developer’s promises at the city or district municipality. One must ask whether a school is actually planned on such and such a plot of land.

Ask the Airplane

The Samolet Group builds residential complexes with kindergartens, shops and playgrounds and is happy to answer all customer questions.
First just look

Request from the developer the documents necessary for legal verification of the new building

Art. 20, 21 FZ-214 obliges the developer to provide the following documents:

The above documents must be provided upon request, but in practice many developers are unable to do this. You may be provided with 2-3 documents that do not in any way reflect the true essence of their possible risks, or they may even refuse to provide documents with reference to the Developer’s trade secrets. But it is important to know that the entire above list of documents in accordance with 214-FZ is not a trade secret and must be provided. Developers who have managers who are not lazy and who have nothing to hide will provide you with a complete list of documents, even those not listed in 214-FZ. The attitude of managers when providing you with documents is one of the indicators that also needs to be taken into account when assessing the risks associated with investing money in a new building.

General list of documents required for checking a new building and the developer:

1. investment contract;

2. project declaration;

3. building permit;

4. design documentation, conclusion of the state examination of design documentation;

5. feasibility study of a project for the construction of an apartment building;

6. land ownership certificate or lease agreement;

7. an agreement with an insurance company (this is an additional responsibility of the developer to the buyer) or a guarantee agreement;

8. extract from the unified register of real estate and transactions with it (land plot);

9. registration and constituent documents of the developer: Charter of the company, certificate of TIN, OGRN, Extract from the Unified State Register of Legal Entities (not more than a month old), accounting. balance sheet for the last 3 years and as of the last reporting date;

10. the form of agreement under which the apartment will be sold;

11. audit report;

12. conclusion of the examination of project documentation;

13. Construction licenses, SRO approval.

6.1. We check the investment contract for the construction of a new building

From this document you can find out the conditions for building a house. It will be useful for you to know how many apartments are transferred free of charge. Many people move to a new building because there are many dysfunctional families in the old building, while in the new building, they believe, there are fewer such families. Due to the fact that apartments are purchased for money, and not received as a gift from the state. But it happens that most of the house is given to beneficiaries and then the contingent will be exactly the same as in the old fund.

The investment contract specifies the developer's obligations, after which the house can be put into operation. In the investment contract, the city administration obliges the developer, as a rule, to build social infrastructure facilities, playgrounds, roads and other improvements to the area. Often, many new buildings have a problem with fulfilling all their obligations under the investment contract, which is why the administration does not sign the necessary documents and the house cannot be put into operation. In the investment agreement you can see the volumes, stages and timing of their implementation of the social load. If the social load is very large, then you may have serious problems with obtaining keys. For example , the developer Aurora, when constructing houses in the city of Zheleznodorozhny Moscow Region, was faced with the fact that he could not deliver social infrastructure facilities. The built houses stood for about two years awaiting commissioning. The situation was helped to move forward by active rallies of shareholders. Don't want to go to rallies? Study the investment contract! An investment contract is not always signed when building a house, but if there is one, then you need to study it. Next, based on the financial condition of the developer, evaluate whether the additional social burden will be an obstacle to transferring the apartment to you.

6.2. Project declaration

As a rule, it is posted on the developer’s website. If not, then the Developer is obliged to provide it to you upon your request. From the project declaration you will learn about the details of the title document for the land plot, about the owner of the land plot (if the developer is not the owner of the land plot), about the cadastral number (this is necessary in order to order an extract for the land), about the timing of putting the object into operation, about the type of property being built and other general information about the property. About the expected time frame for putting the facility into operation. Data on the financial condition of the developer. Information about the quantity of the house under construction (apartments, garages, other objects). Information about the functional purpose of non-residential premises. Information about possible financial and other risks and measures for voluntary insurance of such risks.

In other words, the project declaration is a treasure trove of useful information that needs to be double-checked and correctly analyzed.

How to calculate the return on investment for an apartment?

The payback period of a real estate property is one of the main indicators of its investment attractiveness. This parameter is calculated based on the ratio of the cost of the apartment to the total rental income per year. The resulting figure will indicate the number of years of payback for the apartment.

Let's calculate using an example: we want to buy an apartment for 2.5 million rubles and rent it out for 15 thousand rubles a month, which will be 180 thousand rubles a year. Divide 2.5 million by 180 thousand - we get the figure 13.9. That is, the investment in this apartment will pay off in almost 14 years. Judging by the payback ratio, you can understand what housing is more suitable for - buying or renting:

1. from 1 to 15 years - it is better to buy an apartment than to rent;
2. from 16 to 20 years - a higher figure, but acceptable for purchase;
3. over 20 years – buying is not economically profitable, it’s easier to rent.

If the calculations take into account variable costs, such as the cost of major repairs, property tax, downtime when changing tenants, the payback period will be longer.

6.5. Certificate of land ownership

The certificate should say something like the following, “permitted use of the land: for multi-apartment development or construction of a multi-storey residential building ....”

If the land documents indicate a different category of land, or another permitted use of the land, then the developer will need to re-register the documents, but this is not always possible, so this is also a certain risk. Under no circumstances buy an apartment in a conservation area, as such an object may be demolished in the future. Suffice it to recall the events at the Rechnik gardening partnership.

The land may be leased, therefore, there will be a record of this in the certificate. If the land is leased, this does not mean bad.

Or maybe choose an apartment with finishing (renovation)?

To avoid the above-mentioned delights, you can purchase an apartment in a new building with finishing. This option is preferred by buyers who want to quickly move into an apartment, for whom it is easier to pay a more expensive price than to make repairs on their own and take a long time.

Many developers now offer turnkey houses, including the cost of finishing in the total price. Repairs from a construction company will cost less, and you can celebrate your housewarming much earlier.

6.6. Agreement with an insurance company or guarantee agreement

An insurance contract or guarantee is an innovation that has been in effect since January 1, 2014. This is an additional responsibility of the developer to the buyer. Since 2015, developers are required to insure their liability with an insurance company or enter into a surety agreement. In the event of bankruptcy of the developer, the insurance company or guarantor will compensate all costs of the buyer.

the insurance company using the algorithm specified here.

As for insurance, this can be either an individual contract concluded with each shareholder, or an insurance contract as a whole for the entire new building.

Of course, it is preferable to have a bank guarantee from a bank that is at least in the Top 100 than to have no such guarantees at all. And insurance from a decent company wouldn’t hurt. Even the very fact that the Developer overcame such procedures and was able to register equity participation agreements in accordance with new changes in legislation indicates that the Developer is more reliable compared to those who were unable to do this. Undoubtedly, it is the shareholders (buyers of an apartment in a new building) who will pay for all possible costs of the Developer, but you need to pay for greater security.

But we are not talking about completely eliminating risks. Recently, banks' licenses have been revoked; insurance companies may also not be able to withstand an insured event. Moreover, developers, in their desire to save money, will purchase the cheapest security measures available on the financial services market. And the guarantee of an unreliable insurance company is not even worth the money that the Developer paid for it.

If your Developer registers equity participation agreements, then you definitely need to evaluate the interim measures provided by him. The developer is obliged to bring to your attention the method of security he has chosen and the conditions of the security provided. Basically, the entire test consists of assessing the reliability of the collateral provided. It is necessary to check the terms and conditions of the insurance provided. Often the devil is in the details, and many of the insurance contracts that we saw when checking this or that new building are of no use at all.

Secondary housing or new building?

Affordable price, newness and lack of history of an apartment in a new building versus a lived-in apartment in the area, with a full range of infrastructure on the secondary side, what to choose? It is difficult to immediately come to an unambiguous answer to this question - it is worth assessing the following main criteria.

1. Price

   . New buildings, especially at the construction stage, are significantly lower in price than finished housing.

2. Deadlines

   . You can move into an apartment on the secondary market immediately after purchase, but this will not work with the primary housing. At a minimum, you will need finishing, installation of plumbing, furniture, etc., at a maximum, you will still have to wait until the construction of the house is completed.

3. Investments

   . The apartment from the developer is rented with a rough finish, which entails significant costs for repairs, finishing, purchase of building materials, furniture and equipment. Apartments on the secondary market are lived-in, but may require cosmetic repairs at the request of the new owners.

4. Registration

   . It is impossible to register in an apartment in a building under construction until you have a certificate of registration of ownership in hand.

5. Increase in cost

   . The price of an apartment at the excavation stage can increase up to 30% by the time it is ready.

6. Potential income

   . An apartment on the secondary market can be used as a source of income by renting it out, and such housing can be rented out immediately after purchase.

7. Risks

   . Purchasing an apartment under the DDU carries the risk of construction bankruptcy. You should entrust your finances only to a reliable and trusted developer, minimizing the risk of losing money.

6.8. Registration and constituent documents of the developer

(Charter of the company, certificate of INN, OGRN), Extract from the Unified State Register of Legal Entities (no more than a month old), power of attorney to sign the agreement.

You check the INN, OGRN, address of the legal entity so that everything matches, i.e. you enter into a contract with Romashka LLC and a building permit has been issued to Romashka LLC and the land has been registered. Often apartments are sold not only by the developer; apartments are sold and resold by anyone. In such a situation, you can stumble upon outright scammers who will sell you an apartment that does not belong to them. The attackers find out which developer is selling the apartment and create an LLC with exactly the same name. The law does not prohibit registering an LLC with the same name. These organizations will have different TIN and OGRN. Documents can be completely forged, but this is a topic for a separate article. In principle, all the information necessary for verification is contained in other documents, and if you are conducting a transaction with a lawyer, these documents may not be requested at all. All data can be compared using an extract from the Unified State Register of Legal Entities, a construction permit, and an extract from the Unified State Register of Legal Entities. By using extracts received directly from a government agency, you will eliminate document falsification. It is important that payment under the agreement is made after registration of the DDU agreement and to the details of the developer whose TIN you checked. Such precautions against possible fraudulent schemes may be unnecessary if it is obvious from the circumstances of purchasing an apartment that you are dealing directly with the developer. That is, the developer has been located for many years at the address that appears in the extract from the Unified State Register of Legal Entities, the construction permit was issued to a legal entity with an identical Taxpayer Identification Number, therefore you are dealing with a proper developer.

Check the full name of the general director in accordance with the extract from the Unified State Register of Legal Entities.

The charter must be read to determine the powers to enter into contracts. Who has the right to enter into agreements on behalf of the company, is preliminary approval required from the participants of the Company or the board of directors, the board of the company (if the Company has such bodies). Does the person signing the contract have the right to do so? Is the power of attorney valid at the time of signing the agreement, and have the powers of the general director expired?

6.9. Balance check

You need to look at the amount of profit, loss, receivables and payables. A bias towards losses and accounts payable may indicate that the company’s own funds are insufficient for the construction of the facility. The project declaration indicates the planned value of the property. Next, you need to correlate how many assets a company or group of companies has with the remaining cost of construction, which will ultimately result in the amount that the developer needs to complete the construction.

The same thing again: Let’s say that in the project declaration the developer estimated the cost of building a house at 5 billion rubles, while the amount of equity, which can be seen from the company’s balance sheet, is 2.5 billion rubles. Consequently, to complete construction, the Developer still needs to raise 2.5 billion rubles. Money can be raised from the funds of equity holders or loan funds. The greater the understanding of whether there is enough money to complete construction, the less risks associated with investing money.

Will we be able to use the secure payment service?

The secure payment service protects the seller and the buyer. The buyer transfers money to a special bank account, and the seller receives it only after registering the transaction with Rosreestr. While the documents are being drawn up, the money is in the bank and does not belong to either party.

Safe payments will scare away those who did not actually plan to complete the transaction.

Moreover, if the buyer transfers money to the developer directly before registering the transaction with Rosreestr, the developer may receive a fine of up to 1 million rubles. A company that does business in a whitewash will not take such risks.