Pre-Sale of Residential Property

The pre-sale of residential property to a consumer must be concluded in official form; a private written agreement signed in a sales office does not satisfy the statutory requirement on its own. The official form records the parties, the property, the price and the delivery terms in a way that can be relied on in court. Buyers who sign only informal documents, or new documents without legal review, weaken their position if the developer later disputes the terms. Buyers should insist on the proper form and keep every payment record, since bank transfers are stronger evidence than informal communications.

Where delivery is delayed, the consumer may rescind the contract and claim back what was paid, or alternatively demand performance and compensation, depending on the contract terms, the state of the project and the developer's solvency. Courts examine the written contract, payment records, project documents, permits and expert reports to decide whether the promised property can legally be delivered at all. A common mistake is to accept repeated verbal extensions or to keep paying instalments despite a serious breach. Early action matters because notice periods, limitation periods and the risk of developer insolvency all work against a passive buyer.

The Consumer Protection Law obliges the seller to provide security for the consumer's advance payments, so that the buyer is not left unprotected if the project stalls or the developer becomes insolvent. The form of security is defined in the consumer legislation, and its absence is a warning sign about both the seller and the project. Buyers should ask which security applies to their contract and obtain written confirmation before paying. Even with security in place, developer insolvency makes recovery harder, so an asset and enforcement analysis becomes urgent as soon as serious delay appears.

The consumer has a statutory right of withdrawal from a pre-sale contract, and on withdrawal or rescission the seller must return the payments received. The amount recoverable may depend on whether the buyer withdraws or rescinds for delay, on the contract terms and on the applicable consumer legislation, so the net refund can differ from the gross amount paid. In practice the difficulty is collection: if the developer does not pay voluntarily, the consumer must pursue the claim before the consumer court or civil court and then through the enforcement office. Documented payments and a written withdrawal notice are essential.