Lawpractice

Real Estate Transactions

The purchase and sale of real estate is, for most people, the transfer of their most significant and valuable asset. This means that special attention and meticulous care are required throughout the process.

This procedure must be formalized through a notarized document. The new deed (contract) must be registered with the competent Land Registry Office or the competent Mortgage Registry (where they operate) in order to gain publicity, i.e., it must be accessible to all.

From the buyer’s side, a title and encumbrance research is required. This means that a thorough investigation must be conducted to verify whether there are any mortgages, mortgage notes, seizures, or legal claims on the property to be purchased. This investigation is carried out at the local Land Registry Office, as well as at the relevant Mortgage Registry (even if a Land Registry Office is operational, a search in the Mortgage Registry’s records is always required).

The title and encumbrance investigation concerns the name of the owner, his percentage of ownership, any encumbrances (mortgages, mortgage notes, seizures, legal claims) that may exist on the property, the previous titles (contracts), the owner’s share with the indication of the contracts that have been transferred, an investigation of the regulations of the multi-storey building with amendments to the regulations (if any), while at the same time investigating the land registry office (where they exist) for the possible existence of obvious errors (e.g., when the square meters of the previous contract do not coincide with those mentioned in the land registry for the property of interest) that require correction before the contracts, and the existence of any acts that are pending in the land registry. Finally, in the event that the property has been transferred due to inheritance, further investigation will be required.

The investigation must be repeated on the day of the contracts (in case anything has changed in the meantime, e.g., if a new burden has been registered), while at the same time the existence of any leases must be investigated (if there is no condition in the lease that allows the new owner to evict the tenant, the buyer is obliged to tolerate the lease for as long as it is scheduled to last and under the same terms).

The seller must ensure that he, or she, will receive the agreed price. Although a bank check is a fairly common method of paying the price, there are other alternatives. If the price is not paid in full upon signing the contract, it should be agreed that it will be paid in installments, and in this case the terms of the contract should provide for either a termination clause (i.e., enabling the «cancellation» of the contract, however, a termination clause cannot be included in the contract when the price is paid with a bank loan), or the registration of a mortgage note. However, it is not recommended to pay the price in installments, as payment of the full price upon signing the contract should be preferred.

In addition, the seller must provide various supporting documents, including, for example, the identity of the property (from an engineer), an ENFIA certificate (tax property certificate) for the last five years, tax and insurance certificates and, for apartments, an energy certificate, a building permit, an extract from a cadastral office, or a cadastral property (if the cadastral survey has not been completed), while for plots of land a topographical diagram is required. In order to complete the sale process, time is needed to gather the various legal documents required by law on a case-by-case basis.

In many cases, the parties enter into a private agreement with an advance payment of part of the price, or a notarized preliminary agreement, which provides enhanced commitment and security and is often deemed necessary for particularly high-value properties. The terms of a private agreement require special attention, especially for the party that pays part of the value of the property in advance (buyer).

The role of the lawyer in preparing the contract is crucial because they can secure the buyer, or alternatively, the seller, and help overcome any potential obstacles, thus, speeding up the process. A lawyer can also assist in drafting a private agreement for the advance payment of the purchase price.

On the day of signing the contract, the lawyer present checks the contract that is expected to be signed for any errors so that they do not become part of the new contract.

Our office undertakes due diligence on property title, drafting of private agreements for advance payments, representation in sale contracts, and provides support at every stage of the related process.

Contact us for more information, or to start the process of selling property that you own, or buying property you are interested in.