Shared participation in the construction of housing

The share participation in the construction of housing in Russia is associated with considerable risks for buyers. Often you can hear and read about defrauded real estate investors, long-term construction, construction freezing, gross violations of the terms of delivery. In order not to fall for the bait of scammers, unscrupulous developers, not to buy housing in houses that are unlikely to surrender in time, I suggest that you familiarize yourself with the material below.

In order to protect the rights of equity holders, the law on share participation in construction was adopted (Federal Law No. 214), there are three ways to purchase housing in an apartment building:

1. Signing an agreement of equity participation (DDU).
2. Joining the Housing and Construction or Housing Cooperative Cooperative (HCC and ZHKK).
3. Acquisition of housing certificates.

Also, legal conclusion is concluded with the developer of the investment contract, but this is very risky for the equity investor. The fact is that the investment contract can be concluded at any stage of construction, even at the stage of the project and excavation, without any permits. In addition, in this case, sell the unfinished apartment (to assign the right to it) will not work - the law forbids it.

The most reliable way to purchase housing in the primary market is to conclude an agreement on equity participation in construction. If the developer offers other options, it means that he has some difficulties and problems.

Why should you choose participation in construction according to the DDU scheme?

• Firstly, the developer can raise funds (that is, sell apartments in a newly built house) according to the DDU only after obtaining permits, including building permits, documents for land for construction. In addition, the developer must publish the project declaration in official publications and / or on the Internet.
• Secondly, all concluded contracts must be registered with Rosreestr, which excludes double sales.
• Thirdly, the interest holder has the opportunity at any time to assign his apartment and get his money back.

Taking a share in the construction and signing the contract, please note that it must contain:

• Area, floor, number of rooms, the material from which the house is built, and other housing parameters from the project documentation;
• Term of delivery of the house;
• The price of the purchased apartment;
• Terms of guarantee (not less than five years for the whole house and at least three years for engineering communications).

If the contract does not contain at least one item out of the four above, then the contract is not considered concluded.

If the developer violated the deadline for the surrender of the house, he must pay a penalty in the amount of 1/300 of the Central Bank's rate. If the buyer is an individual, the penalty is paid in twofold.

The buyer may refuse to comply with the terms of the DDU if the developer did not put the house into operation two months after the indicated period, and if the quality of the housing does not substantially meet the requirements and construction standards.

An important indicator that equity participation in construction under the 214th law is the most reliable, - banks issue mortgages for housing in these facilities.

Of course, only the fact that the developer works under the law No. 214 does not guarantee that you will not be deceived. Before taking a share in the construction of a certain house, it is worthwhile to carefully check the developer, you should find out whether he built many houses and put them into operation, whether he violated the terms. It is very useful to search the Internet for legal claims against the developer (for example, on the website of the Arbitration Court).