Limitations on ownership rights: be aware of them before buying a flat
After having purchased an apartment you can face a number of complications with your ownership rights, in other words, you will not have unlimited flexibility with your property disposal.
Therefore it's important to identify the potential difficulties during pre-purchase process what will prevent you from buying such real estate or find the ways how to eliminate limitations before ownership is trasferred to you.
In case of Czech republic you can find the necessary data from Cadastre of Real Estates. Everything you need to know to get information in question is the real estate address and respective cadastral number.
Five things to looking for in Cadastre of Real Estates
In the first place check if the property you're interested in has the sole owner. In case of existence of co-ownership a person who acts as a seller of joint property should have a written confirmation signed by all other tenants.
If you conclude an agreement only with one of them it will not be valid what means that you can be easily deprived of purchased real estate. Sometimes you can find the abbreviation SJM (společné jmění manželů – community property) in cadastral extract.
That means spouses have equal share in this property, therefore the agreement for sale will have legal force only after both of them have signed it.
Another detail which is important to know is the fact that the owner doesn't use the property in question as a security for a loan. If real estate is regarded as collateral you expose yourself to a risk that you will have to “part with” acquired property in case the former owner becomes insolvent.
The right of third side (usually bank) allows it to sell property to receive compensation for outstanding debts of its bankrupt owner and it's entitled to do so even if the property was sold to someone else. Thanks to cadastral extract which will provide you with information about pledged property, creditor and amount of debt you can avoid unpleasant outcomes described above.
Nowadays its most frequent (in case of apartment) form is the acceptance of fact by a new owner that a former proprietor or his / her relatives will continue to live in the flat even after ownership transfer. Take into account that you can change or abolish this right only by agreement or resorting to court, you cannot terminate or withdraw from it on a unilateral basis.
Do you plan to buy a flat with a purpose of conducting entrepreneural activities in it later? Pay attention to the permitted uses of the building you're going to purchase an apartment in.
It is evidence that the property in question is distrained upon and its owner cannot dispose of it, therefore the sale is not possible. However the respective data are often recorded some time after the decision of distraint was made, therefore it's not recommended to make payment before cadastral registration of your ownership was completed.