Our Office provides its services on the field of real estate law for our esteemed clients
1. Drafting real estate sale and purchase agreements
By signing a real estate sale and purchase agreement the seller is obligated to transfer the ownership (title) of the subject of the agreement and the buyer is obligated to pay the purchase price and accept the subject of the agreement. In addition to transferring the ownership (title), seller must also transfer the actual possession of the real estate. The real estate purchase agreement must be in a written form and it is also mandatory to register the buyer’s ownership at the land registry.
With the assistance of our Partner we help our Clients to get what they paid for!
The legal status of the real estate is inspected by Our Law Office thoroughly and covering all details before any amount is paid.
In our experiences we had found that 4 out of 10 real estates may have hidden surprises which could help the buyer estimate the objective price of the real estate and this may be a strong argument throughout the agreement discussions.
Via our Engineering Firm partner Prividom Engineering Ltd Clients have the opportunity to order a engineering assessment to who in our experiences carry out swift and precise work and they have the needed expertise to reveal any relevant information about the real estate trough technical assessment.
§ Connection between real estate purchase agreement and bank loans
Each bank may differ regarding the conditions that must be included in the sale and purchase agreement, which shall be legalised by countersignature of an attorney-at law. Our office has gained excessive experience in drafting sale and purchase agreements with different loan plans.
§ Changes in regards of earnest money (downpayment)
The new Hungarian Civil Code has brought along important changes to real estate purchase regulations. One particular change is that earnest money (downpayment) may no longer be given only in cash, but also by providing other valuable; further the earnest may be handed over not only at the time of signing but at different occasion too, meaning that the price paid trough bank transfer in advance commonly called „advances” may also deemed as earnest (with all its advantages and disadvantages).
§What you should look out for when signing the agreement?
It is an essential condition of gaining ownership (title) of any real estate, that the seller must own the real estate, which means that the seller must be registered as owner in the Hungarian land registry. Furthermore the seller must have the right of (full) provision to be able to transfer the ownership or else transfer may not be possible. The right of provision is ruled out e.g. by restraint on alienation and encumbrance. The official registry sheet of the real estate provides information on all of these matters.
2. Drafting and providing expert opinion on preliminary real estate sale and purchase contracts
Preliminary contracts establish an obligation between the signing parties. Preliminary contracts have a special subject, ie. the objective of signing a (final) contract in the future. Its subject is the final agreement and it declares the will to cooperate, thus the preliminary contract establishes the obligation to sign the future agreement.
Preliminary contracts dealing with sale and purchase of real estates required by law to be in the same form as the final agreement, therefore written and countersigned (legalised) form is mandatory.
3. Establishing and termination of usufruct and similar rights
Establishing usufruct (exclusive right of use) may be achieved through contract or by legislation. In order to establish usufruct – apart from a contract on this subject or other substantial title – the transfer of possession must be carried out as well, in case of usufruct over a real estate or usufruct to be established on a right registered in the land registry, it is required that the usufruct to be registered in the land registry.
The usufruct right holder may possess of things that are under the ownership (title) of other persons, has the right of usage, exploitation, legal and beneficial title; from the licenses of ownership only a few the rights, such as disposal and destruction is not included in the right of usufruct.
When referring the erasure of usufruct we refer to the deletion from the land registry. Actual erasure may be carried out before or after the death of the entitled person. With the death of the entitled person termination is automatic, but erasure of usufruct is not executed automatically – the land registry office has no knowledge about the time of death of the entitled persons –therefore the procedure of the land registry office only starts upon application.
4. Drafting real estate donation contracts
On the basis of a grant contract, one party must grant an asset free of any charge from his own funds to the other party. Such grant may only be considered a gift if at the same time the other party experience an aggrandizement (increase of value) in respect of his property.
Based on a grant contract the grantor shall commit himself to transfer the possession of the subject of the contract to the granted without any service expected in return. Real estate grant contracts must be in a written form and counter-signed by an attorney-at-law (similarly to real estate purchase agreements) furthermore the (new) title of the granted must be registered in the land registry.
5. Drafting real estate exchange contracts
In the case of real estate exchange contracts both parties are sellers inrespect to their own real estate and purchasers regarding the other party’s real estate. By signing the real estate exchange contract both parties agree on the mutual exchange of ownership of their real estates.
At the signing of the exchange contract no financial flow is present (or only additionally), none of the parties have to pay a purchase price for the transfer of the ownership (or only just to compensate the price difference) they however agree on transferring the ownership (title) of their own real estate to the other party.
6. Drafting apartment rental and other real estate rental contracts
Apartment rental may be established by the mutual understanding of the parties in a written form in which they have to agree on the relevant conditions or on the conditions considered to be relevant by one party, such as duration of the contract, defining the actual apartment, the rent (fee) and assurances. According to the Hungarian Civil Code the maximum amount of assurances is the price of three months’ rent.
Our Law Office supports lessors who strive to – without violation of the law – regain possession of the real estate in case the tenant is not paying the rent or in other breach of contract and help them to lawfully terminate the contract
§ The entry into force of the new Hungarian Civil Code
The Civil Code has brought along numerous changes in regard to real estate rental as well. Such important change is that rental contract may be signed for a duration of less than one month or that the tenant may terminate the contract at the occurrence of the apartment (or other premises) being in a life threatening condition even if tenant knew about the circumstances beforehand, such as at the time of signing the contract.
Should you be interested in real estate sale and purchase, tenancy/lease or swap transaction, Our Law Office is glad to assist in regards of drafting such contractual agreements or provide general counselling in these matters, and of course if legal or engineering review seems necessary, owe are at your service as well.