When you are buying a property which has been standing for many a year it is easy to know (or find out) what, if any, problems lessees within the building may have encountered with their properties. Indeed, as part of the Preliminary Enquiries Before Contract which will be raised by your solicitor, this is one of the questions which the vendor will have to answer. It is not as straightforward however when you choose to buy a property “off plan” which can unfortunately sometimes lead to traps which were not readily evident at the time.
There are various factors which you should consider when contemplating buying an off plan property. Firstly and very importantly, you need to find out who the owner or the developer is. It is all too common nowadays to find that the vendor is a single purpose company set up solely for the development. When purchasing off plan it is important to ensure that the developers, builders, contractors and subcontractors are organisations of substance with good standing in the construction industry, otherwise purchasers may find themselves with a virtual shell company when trying to sue for breach of warranties or undertakings.
OTHER IMPORTANT CONSIDERATIONS INCLUDE: The payment of the deposit. Who will hold the deposit, in which account and upon what terms?What type of guarantees is the developer willing to give in relation to defects? What is offered may tell you a lot about the vendor’s integrity. Is there a “get out” clause? Whilst contracts generally provide the vendor with the ability to terminate the agreement, it is much more difficult for a purchaser to do so. Does the contract limit the alterations which may be made by the developer? It is important that purchasers satisfy themselves that the final build cannot be reduced below a certain size or quality. This is also important with the provision of garages or parking spaces - what are the proposed dimensions of the unit and will it accommodate your existing vehicle?Are there any proposed developments in the vicinity which may diminish the view or adversely affect the value of your investment?
These are just some of the considerations to bear in mind. It is essential that when looking to buy an off plan property you instruct your solicitor to advise you on the terms of the contract and the proposed Underlease which will, upon completion provide you with legal title to the property - are there any unusual or onerous covenants? Are there any resale or letting restrictions? Buying a property is usually the single most important purchase you will make in your lifetime and one which you should protect with sound legal advice.
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