Tips about buying new apartments: 5. Introducing the 7 “mothers in law” – Many possible problems to protect from

This article was published on 15.03.2010

Investment in a new apartment is one of the most important moments in the economic life of each and every one of us. Statistics say that we usually buy 1 – 3 dwellings during our life, so every mistake counts. Some people consider that buying an apartment in a new block is easy, some others consider it a very difficult task to accomplish. It is definitely better than an old property, but it is not always so simple. New apartments include many new parameters, which you must know and analyze before you proceed. There are solutions for everything but they require your attention, time and careful decisions. In order to avoid hurting your… wallet.

1. Forget the "one man show". Now you talk to a company and tens of its collaborators.
When you buy an apartment in an old building, 99,99% you will buy it from one individual. He also probably bought it by someone else, or he received it back from the Romanian State. He is not responsible for the quality of construction, how the building looks like today and what problemshappened through time. He may be serious enough, so as to be responsible for his own apartment, but there are too many out there who are not responsible not even for this. You buy something and you also "inherit" all its problems, stories and "secrets". Theoretically speaking, this sounds easy, you discuss only with one person. Well, forget all these, now you have a whole team of people on the other side of the table. Be ready for new… connections!

2. Your developer's 7"Mothers in law": His bank, architect, lawyer, accountant, constructor, real estate broker and notary
Yes, I know. When you go to talk about the new apartment of your dreams, you just meet a lovely gentleman or lady, well dressed, ready to reply in most of your questions. (At least now they got also civilized. In the past most of them used to speak like this: "few details, this is the price, if you don't have the money, don't spend my time"). But behind this person, you will soon discover plenty of others. So… guess what:

• Most probably you can have a loan just by the developer's bank. This is not always bad, but be ready to meet new bankers, with pre-approved – not flexible "solutions".
• There is an architect who designed this project. You may see him (or his colleagues) while you will ask someone to explain to you how to optimize the surface of the apartment before you sign the contract. Or if you want a minor modification. Get ready to meet with an "artist"…
• Lawyers are always needed (if not, they establish their presence by themselves!) The developer will definitely have someone. So, be ready to read contracts drafted in a way that protect his side 101% and when you will ask for a modification, "your lawyer should meet his lawyer, when both of them will find the appropriate time".
• You are not supposed to meet his accountant. But you will hear about him, when the time will come for contracts, payments, invoices etc. And you may meet him too. Not for good…
• His notary is usually the most reliable partner of all. My experience says that the vast majority of Romanian notaries are very careful. But as exceptions are here to confirm the rule, everyone must be checked too.
• The Real Estate broker – consultant. He appears in the beginning. Usually he / she knows just "a story", without too many details about the project etc. Long discussion on this topic…
• The constructor, your possible "nightmare". It depends on when you buy the apartment. The earlier you want (first phases), the more time you will spend with his representatives. (More time = tens or hundreds of hours)

(Starting with next week I will explain to you everything regarding all these "mothers in law" and their relation to the developer and you)

3. Urban myths regarding developers, which are far from reality…
Before we open the discussion regarding the tips you need to know regarding the developer and all his several "mothers in law", let us clarify some things. There are some urban myths which I hear or read. And, trust me, they are VERY far away from reality…

• "It is easy for someone to develop a project. They do nothing, just charge a lot and make profits". You can not imagine how complicated is the development of a project, especially a residential one. Even more in a country like Romania. There are 1… trillion problems to solve. Who finds it easy? Someone who never built, not even one block with 10 flats.
• "Why don't they develop in large scale, in order to get better prices and sell cheaper?" Because they don't find financing by a bank and also it is very risky. Also it requires either higher costs, or an excellent team of colleagues. People don't like the first, but they also don't like paying for the second either.
• "They are all bad and behave like crooks, stealing our money". Yes, many of them are neither serious nor professionals. But it is not so difficult to protect ourselves from them. Plus, someone serious should be paid sufficiently.

4. Our goal: To create a new success story, YOURS
Necessary clarification: From the feedback I have by my readers, almost all of them are civilized enough, so as to focus on the substance of the problem, avoiding to generalize and just assume that they are victims, while all the rest (and especially the developers) are the bad ones. All my tips have one goal: To provide you the necessary feedback in order to have a nice deal, protect yourselves and create a new success story, YOURS.