Buying an apartment in a new construction brings undeniable advantages for future owners - living in a new and modern home, potentially lower prices because the property is purchased during the construction phase, as well as the possibility of VAT refund if it is the purchase of the first property. Additionally, investors usually offer the option of payment in installments, and a housing loan is approved after the property is 80% constructed, making it a viable solution for almost everyone.
Many people are concerned when it comes to buying a product that is still not in its final form, such as a property under construction, but you should know that this purchase is a common and regulated practice, so you have no reason to worry when you find reliable partners. Experts whose assistance you will need during this process are essential: a real estate agent, lawyer, and notary.
Before purchasing an apartment in new construction
In Serbia, there is a large number of investors currently investing in the real estate market, and there are even more properties under construction. It is crucial that you are confident in the company of the investor from whom you plan to buy an apartment. It is desirable to have a recommendation or to check their business at the Serbian Business Registers Agency. Make sure to ask your agent anything you want to know about deadlines and their previous projects. The documentation that investors need to provide in the initial stages of negotiation with the buyer includes the building permit, its finality, house number resolution, possible foundation and construction checks, as well as evidence of taxes paid to the state, such as municipal land tax, electricity tax, water supply, postal, and sewage fees.
After you decide on the desired apartment, the next step is signing the purchase agreement, which is drafted by a lawyer and notarized. Upon payment of the agreed price, you will receive a written confirmation of payment.
Once the building is completed, it is necessary for it to undergo a technical inspection so that the investor can submit documentation for the occupancy permit. This permit is issued by the competent authority, and the waiting period can range from six months to up to two years in some cases. This does not challenge the legitimacy of the construction, and buyers can, after the building is completed, move in and dispose of their property as they wish, whether by living in it, renting it out, or selling it. Therefore, there is a waiting period for the occupancy permit before the property can be registered, but in practice, this does not change anything for the buyer because they have already become official owners.
Once the occupancy permit is obtained, the building is registered in the Real Estate Cadastre, and then the buyers of the apartments will be registered as owners of the individual units - apartments. This procedure is further facilitated for buyers thanks to the current new system in which developers handle this independently, without the need for buyers to physically go to the Cadastre.
Your obligations after moving into new construction
Upon moving in, you need to transfer the right to use electricity, from the investor to your name. This is done by going to the branch office of the Electric Distribution Company responsible for the municipality where the apartment is located. The list of addresses and branches can be found on the Electric distribution company's website. Required documents include personal IDs of owners and buyers, sale contract, and its copy.
You also need to register as a new user of communal services within 8 days of starting to use them. Sometimes this step is also taken by investors on behalf of apartment owners. The appropriate documentation and branches per municipalities for the city of Belgrade can be found on the website of the public utility company "Infostan technologies". Equivalent companies will provide you with information regarding this procedure in Novi Sad and Niš.
After concluding a real estate purchase agreement and becoming the owner, you become liable for property tax. It is determined by submitting a tax application to the competent tax authority within 30 days from the date of signing the contract. This also applies to any other real estate that you purchase as a separate unit, such as a garage.
Refund of VAT to the first-time apartment buyer
Another reason why apartments under construction are popular is the possibility of VAT refund to the first-time apartment buyer.
As a first-time real estate buyer, according to the law, you have the right to refund the tax amount: one household member is entitled to a refund for 40 m², and each subsequent member acquires the right to a refund for 15 m². This does not happen automatically, but it is necessary to submit a request to the tax authority in the municipality where the apartment is located. In case the investor is a physical person, instead of the VAT system, there is a transfer tax, for which you also have the right to a refund under the same conditions.
Because of all the reasons mentioned, many buyers consider buying an apartment in new construction the best solution for their housing needs. If you need individual consultation and offers for new apartments under construction according to your preferences and possibilities, contact our agents. We offer direct communication with the investor, legal assistance, and guidance through the entire process until moving in - AND THAT WITHOUT COMMISSION!
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