Unsolicited Arrival: Houseowners Brace forUnexpected Intrusion in June
12:00 PM, June 18
Caprice Choudhury
Beware the charming trap when purchasing affordable real estate: a pro warns about hidden landmines. Tempting deals on homes often serve as bait for green buyers, who could potentially find themselves penniless and homeless.
Understanding the Potential Nightmare in Inexpensive Housing
Real estate whiz Alexei Krivenskiy highlights a crucial pattern: apartments sold for rock-bottom prices frequently conceal legal issues. It's not charity from sellers; it's an attempt to swiftly dispose of a troublesome asset.
Data from real estate agencies indicates: up to 15% of discounted property sales end up in court. In such instances, new owners often lose both their investment and their roof.
The core issue is that secret heirs and people with rights to the property might emerge months or even years post-sale. Russian law frequently supports those with legitimate claims to property.
The Riskiest Categories of Questionable Housing
Homes after privatization pose a particular danger. Children of the vendors who were minors or absent during the privatization process still hold rights to a share in the property. Even if they weren't officially involved in the process, a court might acknowledge their rights.
Inherited apartments also come with risk. Relatives of the deceased owner may sudden claim their rights, especially if they previously declined the inheritance but later changed their minds.
Properties with debts are often sold at throwaway prices. The new owner may face demands from utility services, managing companies, or even the previous owner's creditors.
How Problems Occur
The process of registering property rights might go swimmingly, but it doesn't guarantee the safety of the transaction. Rosreestr registers the transfer of ownership based on the papers provided, but it doesn't scrutinize all potential third-party claims.
Issues typically surface 3-6 months after the sale, when interested parties become aware of the ownership change. This is when the sequence of legal disputes commence.
Fascinating fact: Article 302 of the Russian Civil Code protects honest buyers, but proving innocence in court can be Herculean, particularly if the deal price was suspiciously low.
Legal Consequences for Buyers
If a deal is successfully challenged, the new owner must return the apartment to the rightful claimant. However, compensation for spent money is not always guaranteed, especially if the seller has vanished or gone bankrupt.
Forced eviction of strangers into the procured apartment is far from unprecedented. The court may order the new owner to provide living space to individuals who hold rights to the property.
Additional expenses for legal defense can range from 100,000 to 1,000,000 rubles, depending on the complexity of the case.
Recognizing a Shady Proposal
A price below market value by 15-20% should serve as the first red flag. If the seller explains the discount with "urgency" or "personal circumstances", further examination is needed.
The seller's reluctance to provide comprehensive documentation or attempts to rush the deal at any cost are clear indications of problems.
A messy ownership history with numerous rights transfers, previous ownership by minors, or deaths of previous owners necessitates close scrutiny.
Protecting Against Deception
Comprehensive checking of the apartment's history through an extract from the Unified State Register of Real Estate will help identify suspicious aspects. It's advisable to request an extended extract, which contains information about all rights transfers.
Title insurance - additional protection that compensates for losses in case of loss of ownership rights. The policy cost is 0.1-0.5% of the apartment's value.
Engaging a lawyer to review documents will cost 20,000-50,000 rubles but can save a small fortune in the future.
Alternative Purchase Choices
New buildings from developers are the safest option, although they're not always wallet-friendly. The risk of fraud is minimal, and buyers' rights are protected by law.
Apartments through large real estate agencies involve additional document checking and partial risk insurance.
Auctions and sales by banks of seized property are a legal means to purchase real estate at a discount, with minimal risk.
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- Due diligence is essential when considering affordable real estate, as attractive deals may conceal legal issues and significant financial risks, such as disputes with secret heirs, unexpected debts, or sudden claims from relatives.
- When investing in real estate, strategies like engaging a lawyer, purchasing title insurance, and researching the property's history through the Unified State Register of Real Estate can help mitigate the risks associated with questionable housing. Additionally, investing in new buildings from developers or properties sold through large real estate agencies can offer a safer purchasing option, but at potentially higher costs.
