Purchasing an appartment in Georgia - What you should check!

Purchasing an apartment is one of the most important decisions in life. It does not matter whether you are planning to move in or are interested in investing in real estate.

When buying an apartment—especially if it concerns a property in a building/complex that is still under construction—certain risks must be taken into account to ensure that the buyer’s expectations are fully met.

The success of a real estate transaction depends not only on a well-reviewed contract but also on: ongoing maintenance costs, and so on.

• the construction company/developer and their track record,
• the construction project and permitting documentation,
• the construction history,
• the completion deadline,
• the sources of construction financing,
• ownership title documents registered in the Public Registry,
• the property’s location,
• functional zoning,
• the intended use of the apartment (residential, tourist apartment, or commercial premises),
• the condition in which it will be handed over,
• the view,
• ongoing maintenance costs, and so on...

After investigating all these details and deciding to proceed with the purchase, it is essential to legally formalize the transaction. Any real estate transaction—whether a purchase agreement, preliminary purchase agreement, or another type of transaction—must be registered in the Public Registry to be legally valid. Your ownership right over the property is confirmed by an extract from the Public Registry.

Payment terms are also important. For example, will you pay in cash or via non-cash transfer, in a lump sum or through a mortgage loan, or will you use other banking services related to the payment?

It is important to determine in advance whether the purchase price includes any hidden costs (such as utility metering fees), state taxes, and whether such taxes can be refunded or credited (for example, VAT in the case of purchasing commercial premises). If you plan to rent out the apartment, will you be required to pay personal income tax, and in what amount? Will you have to pay property tax, file a declaration, and if so, when and how much? Will selling such property in the future subject you to any taxes?

Considering these and many other nuances in advance and planning the appropriate strategy significantly increases the success of your investment. Therefore, when you decide to buy an apartment, for comprehensive legal support, contact us!