How to protect yourself from making mistakes while investing in property?

How to protect yourself from making mistakes while investing in property?

Development specialist Vladimir Sementsov gives few valuable advices on choosing the tenant builders

During the last year among all inpayments in the economy of the capital 6% from it were investments of the citizens in housing construction. It is worth noticing that it was only 0,7% of foreign investments. Capital investors are still interested in property market. Constructing is a driving force for economy of Kyiv, and also a profitable field to invest in.

Frequently Ukrainian tenant builders tempt the clients with good discounts on property. But you shouldn’t concentrate only on the price. There are times when unreliable builder tries to pull out the money from the client using this as a strategy for illegal investing in new unit, before facility commissioning.

Recently, the investigation, which was pursued by the journalist, exposed the building pyramids of “Ukogrup” and “City group” companies. Till present days authorities are obliged to solve the  problems of those, who were involved in this speculation, which also has an impact on the reputation of reliable builders.

Selection of builder and investment object is a difficult thing to do, and it requires a considerate analysis of all available information. Only a good and balanced decision will help to reduce the risk.

Verification of the builder through the internet

For citizens to know about all the construction works, which are performed at the moment, authorities launched the Kyiv construction monitoring center. The portal, with a support of Investor Association has the information about 1250 building projects. At this point specialists were able to check only 184 of them. And now, data shows that 40% of examined projects are in the process of construction without any documentation, names of which are marked red. There are also projects, which need to be double-checked.

Builder`s history verification

In this case investor is interested if builder has any charges. This information could also be found in Internet. If you didn`t find any results you should probably choose him.

Determine the way of project funding

Some investors finance their building projects only at the expenses of investors. Sometimes the end of existing construction works depends on means of clients, which invested in the new project. This kind of financing system seems to be suspicious. For a property buyer I would be rather convenient, if the builder or the big investor invest in this project by their own means.

Familiarization with documentation

The most available way to familiarize with documents is the site of the builder or the newbuild. First of all you should pay attention to these documents:

  1. Building permission, which is granted by GASK .
  2. Technical terms on linking to residential network  .
  3. Document, which proves proprietary rights or land leasehold.

If the builder is reliable, you will be able to find all those documents on his site. However investor should probably negotiate with a lawyer, in order to make certain of document authenticity.

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