Purchase and sale of immovable property
Arranging a sale or purchase
You may decide to handle the sale or purchase of immovable property “on your own”. Although the law allows any individual to arrange the sale or purchase of their own immovable property, to avoid problems that may arise later in connection with the transaction, we recommend seeking professional assistance. This may be a lawyer authorised to provide legal services—an attorney or a notary, who may administer a client’s property, an activity similar in some respects to real estate services—or a real estate agency that is authorised to conduct real estate business and has an agreement for the provision of legal services with a licensed lawyer.
If you have decided to consult a lawyer—an attorney or notary—and wish to check whether they are authorised to provide legal services and are a member of a professional organisation, namely the Slovak Bar Association or the Notarial Chamber of the Slovak Republic, their name will appear in the list of attorneys on www.sak.sk or in the list of notaries on www.notar.sk. You may also ask the lawyer to provide proof that they are authorised to provide legal services.
The difference between a real estate agency and a lawyer is that attorneys and notaries are insured by law against damage caused to their clients in the course of their professional activities. If damage is proven, the State pays compensation and subsequently seeks recourse against them.
Checking the condition of the property and verifying the parties
Before buying immovable property, you should verify that the seller is its actual owner and check the property’s legal and factual status. Do not forget to check the buyer’s creditworthiness as well.
If you decide to handle the purchase and sale through a real estate agency or a lawyer, a professional will take all the necessary steps on your behalf.
Sale and purchase agreement for immovable property
A sale and purchase agreement should not be taken lightly. It is the most important document in the transfer of immovable property. You may prepare it yourself, but you risk encountering problems later in connection with the agreement you have drawn up.
Sale and purchase agreement in the form of a notarial deed and filing with the Land Registry
If you decide to consult a lawyer, a notary can provide a comprehensive service in connection with the sale of immovable property. In particular, the notary can prepare a sound sale and purchase agreement and file it electronically with the Land Registry under expedited proceedings, at a reduced administrative fee. If you are buying with cash, you can also use a notarial deposit for the safest transfer of immovable property currently available on the market.
A good sale and purchase agreement for immovable property
If you have decided to sell or buy immovable property, you need a “legally secure” sale and purchase agreement. It is known by various names, such as a purchase and sale agreement or a sale and purchase agreement for immovable property. If its subject matter is an apartment, it may also be called an agreement on the transfer of ownership of an apartment. For the purposes of this article, however, we will refer to it as a “sale and purchase agreement”.
What should a sale and purchase agreement contain?
Every sale and purchase agreement must be in writing and include the essential particulars required under the Civil Code in order to be valid. It must identify the contracting parties and the subject matter of the sale or purchase, and state the purchase price. The purchase price should reflect the market value so that it is reasonable.
In the case of a sale and purchase agreement for an apartment or non-residential premises, in addition to the essential particulars required under the Civil Code, the agreement must also contain the particulars required under Act No. 182/1993 Coll. on the Ownership of Apartments and Non-residential Premises, in particular:
- A description of the apartment or non-residential premises and their accessories.
- A description of the common parts and common facilities of the apartment building.
- Arrangements concerning rights to the land on which the apartment building stands and to adjoining land.
- The technical condition of the apartment or non-residential premises.
- Administration of the apartment building.
- Arrangements concerning rights to civil protection facilities.
Additional provisions of the sale and purchase agreement
The sale and purchase agreement must also include additional provisions in the form of the seller’s representations concerning the technical condition of the property. These may include, for example, disclosure of apparent defects and the property’s legal status, any encumbrances on the property, any debts or arrears relating to it, any pending court or other proceedings, and any obligations the seller has undertaken towards third parties in relation to the property under another agreement or arrangement.
As regards the buyer’s representations, the sale and purchase agreement should also include statements confirming, in particular, that the buyer is not insolvent, has no obligations to third parties that would limit their ability to pay the purchase price, is not subject to enforcement proceedings or other proceedings, and is not in a legal position that would prevent them from performing their obligations under the sale and purchase agreement, and so on.
It is advisable for the sale and purchase agreement to include the following provisions as well:
- Settlement of any arrears and debts relating to the property.
- Transfer of ownership from the seller to the buyer.
- Entry into force, effectiveness and creation of rights in rem under the agreement.
- Handover and acceptance of the property.
- Transfer of the risk of damage to the property.
- Resolution of the seller’s registered permanent residence at the property, and that of any other persons.
- Alternative accommodation.
- Transfer of utility accounts.
- Suspension or discontinuance of the registration proceedings at the Land Registry.
- Withdrawal from the agreement.
- Stipulation of contractual penalties.
- Compensation for damage.
- Service of documents.
- Fees for certification of signatures by a notary and the administrative fee payable to the Land Registry.
- Real estate agency commission.
- Fees for legal services provided by an attorney or notary.
An impartial sale and purchase agreement
The sale and purchase agreement should be balanced and equally favourable to the seller and the buyer. The scope of the seller’s rights and obligations should correspond to the buyer’s rights and obligations. If a layperson draws up the agreement, it will always be favourable only to that person and not to the other party. They will invariably include more rights than obligations, which often have little to do with the law or with their potential enforceability.
If you approach a real estate agency, it should have its contracted lawyer prepare an agreement that protects the interests of both parties. In practice, however, it often happens that even so, the agreement benefits only the seller or the buyer, usually the party paying the real estate agency’s commission.
If you consult an attorney, they will proceed in a similar way. An attorney always enters into an agreement for the provision of legal services with only one contracting party as their client—the seller or the buyer—and will therefore naturally represent their client’s interests.
If you consult a notary, the law requires the notary to be an impartial and independent person. The notary must not favour either contracting party, because they are a public official and the performance of notarial activities constitutes the exercise of public authority entrusted to them by the State.
Every individual in the Slovak Republic may draw up their own sale and purchase agreement when selling their property or buying property for themselves.
In most cases, however, the agreement fails to pass the proceedings for authorising the registration of ownership with the competent district office’s Land Registry Department, or another problem arises. Common issues include failure to pay the purchase price or part of it; legal or factual defects in the property; failure to hand over the property; withdrawal from the agreement and the resulting retransfer of ownership; the risk of damage or accidental deterioration of the property; newly discovered encumbrances, debts or arrears; and court proceedings relating to the property, among other things.
It is very difficult to prepare a good sale and purchase agreement for immovable property without appropriate legal education and experience. Do not rely on templates downloaded from the internet! You do not know who wrote them, whether they meet the legal requirements or whether they contain everything you need to address in your particular circumstances. We strongly recommend using the legal services of an attorney or notary.
nubb.sk
