When we start selling real estate, the basis is not the classic purchase and sale agreement that is concluded when selling movable property. It is necessary to conclude a contract of sale in the form of a notarial deed, which allows for the formal transfer of ownership of the property. We present how the process of selling a house or apartment should go step by step.
Step 1. Property valuation and sale announcement
Before we issue an advertisement informing about the willingness to sell real estate - a house or a flat, we must perform a reliable valuation of our property. This stage cannot be skipped as it determines many issues, incl. how quickly the sales process will be completed, whether we will earn on the transaction or whether we will have to actually contribute to it. The selling price of the flat results from its value and ultimately affects the amount of tax that will have to be paid on the entire transaction.
The appraisal of an apartment should be made on the basis of objective premises and criteria. The value of the property is influenced by:
- its size,
- technical condition,
- No. of rooms,
- a recent renovation,
- belonging to a business unit, parking space or garage.
Based on all the collected, relevant information about the property, we can compare it to similar properties already put up for sale, in order to have a full picture of the current market rates. Alternatively, you can have a real estate appraiser make a precise, reliable valuation of the property.
At this stage, the only thing left to do is to write an advertisement about the sale, take attractive photos of interiors and post an advertisement on the auction site or on the selected advertising platform. Photos are the key to success. They must attract the attention of potential buyers and present the apartment or house in the best possible light.
Step 2. Collecting the necessary documentation
If we already know the real, current value of our property put up for sale, we should prepare documentation from which the legal status of the house or apartment will be derived. We need to make sure that we are the sole proprietor of the property. Then we have the full right to freely dispose of the premises. If this is not the case, you need to negotiate with the co-owners to see if they agree to make the sale. It is also necessary to agree a notarized transfer of ownership to one person and possibly prepare a document that will guarantee the appropriate distribution of profits.
The unclear legal status of real estate can be an obstacle to sale. Then it is worth turning to experienced brokers who know how to proceed to sell the problematic apartment.
As part of formal preparations for the sale of an apartment, documents such as:
- A document confirming the legal title to the premises or house, e.g. a notarial deed or a court decision confirming the acquisition of an inheritance or an extract of an inheritance certificate.
- If the seller is married and there is joint property between the spouses, he must present an extract of the notarial deed establishing this contract.
- When encumbering the real estate with mortgage, obtain a declaration of the mortgagee about the amount of debt, the date and conditions of the mortgage release, or consent to remove the mortgage.
- Certificate of the number or absence of registered tenants.
It is possible that other documents will be needed for the sale, e.g. for apartments with the status of a cooperative housing it will be a cooperative ownership right certified by a cooperative.
Step 3. Preparation of the preliminary contract
Once we find a buyer willing to buy a flat or a house at a negotiated price, it may be necessary to draw up a preliminary contract that obliges the parties to conclude a final contract at a certain point in the future, i.e. a real estate purchase and sale agreement in the form of a notarial deed. A preliminary contract may be required by a potential buyer, e.g. to complete formalities related to obtaining a mortgage loan for the purchase of real estate from a bank.
Usually, as part of signing the preliminary contract, which can be done in front of a notary public, but does not have to be done in the form of a notarial deed, the buyer pays an advance or a deposit to the seller.
Step 4. Signing the notarial deed
In formal terms, the most important element of the real estate sale process is a visit to the buyer's and seller's notary and signing the contract - a notarial deed. You have to make an appointment with a specific notary's office, usually at least a few days in advance. This is the time worth spending on preparing the documents necessary to draw up the contract. You will need information such as:
- Personal data of the parties to the contract, including PESEL numbers, number and validity date of ID cards.
- About the marital status of the parties and their marriage contracts.
- The method and date of payment of the price and its amount.
- How and when the apartment is delivered to the buyer.
The notarial deed will contain a comprehensive description of the property, along with an indication of where it is located and whether it has a mortgage or other encumbrances. In the text of the contract, the notary will include the method of transferring the payment - e.g. own contribution and the remaining part in the form of a loan granted by the bank. Along with the contract of sale, there is also an application to change the data in the land and mortgage register and a declaration of submission by the buyer to enforcement if he would not fulfill the obligation to pay for the purchased real estate.
The contract can also include information about the equipment remaining in the house or in the apartment. It is necessary to put in it the date of leaving the premises and emptying it. If everything is OK, the parties to the contract sign the notarial deed in the presence of a notary.
Step 5. Pay the property sales tax
The sale of real estate involves not only signing a notarial deed or the physical handover of the keys to an apartment or house. A tax obligation arises on the seller's side, which he must fulfill. In the case of the sale of the purchased apartment, this activity should be included in the tax settlement, but only if less than 5 years have passed since the purchase of the property, and this period is counted in tax years, not calendar years. The tax due to the tax office is calculated using a tax rate of 19%. on the amount of income.
In many cases, the seller of real estate may benefit from a tax relief. It is entitled if, within 3 years from the sale of the real estate, it allocates the money obtained from the transaction for the implementation of the so-called own housing purposes, e.g. for the purchase of another flat or the repayment of a mortgage taken out earlier.
If the sold flat was inherited or donated, new regulations apply to this regard when taxing the sale transaction. The aforementioned 2019-year period is counted from the moment of acquiring the right to the premises by the testator.