Buying off plan abroad means trusting a company you have only seen on a website. Online reviews do not help: some are written by the developer, some by competitors, and bad ones exist for good companies too.
What you check are documents and history, and almost all of it can be done from Ukraine. Below is the order in which we do it.
First: does the company exist, and which one is it
Advertising carries a brand, while the contract is signed by a legal entity with a different name. That is normal, but you need to know which entity will be the party to your contract and to check that one rather than the brand.
Most countries have an open company register: name, date of registration, founders, director, share capital, sometimes financial statements. Turkey, Bulgaria and EU states all have them. The check takes a day.
What to look at: the date of registration, because a company formed three months ago has no history; whether the founders changed every year; whether there are signs of liquidation or insolvency proceedings.
Separately: a company formed for one specific project is common practice and not bad in itself. But it means only that company answers under the contract, not a group, and its capital is all it has.
Second: permits and land
A building stands on land, and the first question is whose land. The land documents and the building permit are things shown on request, and a refusal to show them is itself an answer.
Next, check that the permit covers the property and the number of storeys actually being sold. Discrepancies between a permit and the advertised project occur, and they mean some floors may never receive documents.
In Turkey there is an additional check: whether the building will receive its iskan, the habitation permit. Without it an apartment cannot be connected to utilities officially and is hard to sell on.
Third: what the company has already built
This is the most useful part. A list of completed projects with addresses, and for each: whether it was delivered on time, whether it received its documents, and what the people living there say.
Delivery dates are verified from documents and local register publications rather than from statements. If the company missed deadlines on two projects out of three, the third will slip too, and that belongs in your plan.
For buildings finished some years ago there is a simple test: look at what apartments in them fetch on the resale market now. If resale in the complex is cheaper than what the developer asks in a new building next door, buyers have a reason, and it is worth finding.
Fourth: courts and debts
Court records are open in many countries, and claims against a developer show up there. One case means nothing; a dozen claims from buyers about missed deadlines means a great deal.
Where the register is closed or the language barrier is insurmountable, a local lawyer does this. Their work at this stage costs less than any of the problems they uncover.
Fifth: the contract
Everything above exists so that you reach this point prepared. In the contract we look at: what exactly is being sold, the handover date as a date, liability for missing it, the payment schedule, what happens if you are late, whether the right can be assigned, the handover inspection procedure and the warranty on the construction work.
Separately: where the money goes. The company's own account, a project account, escrow or a notarial deposit represent different levels of protection. In some countries escrow is mandatory and in others it is not, and where it is not you are simply paying into a company account.
Sixth: taking delivery
Checking a developer ends not at signature but at handover. That is the day you either find the defects and record them, or sign the acceptance and put everything right at your own expense afterwards.
What a person looks at on handover: the floor area with a tape measure, because a metre of difference is thousands of dollars; walls, screed, windows, doors; water, pressure, drainage; electrics at every point; ventilation; whether the lift works and whether the building is genuinely complete rather than merely declared so.
If you cannot travel, the handover is done under a power of attorney by a local specialist producing a report with photographs, not by the developer's representative. Those are different people with different interests.
Defects are recorded in writing with a deadline for rectification. An acceptance signed without comment, in the excitement of the moment, closes the matter for good.
What the check will not give you
It will not give a guarantee. A company with a good record, valid permits and no litigation can still halt construction if the market or the law changes.
So one simple rule goes with the check: do not put into an early stage building a sum whose loss would break your plans. And look at projects with nearer completion dates even where they cost more: the price difference is the price of the risk.
How we do it
We check the company in the register, request the land documents and permits, assemble the list of completed projects and review their history, read the contract together with a lawyer in that country, and tell you where your risk sits.
If we do not like the company, we say so, even when the property is good and the price attractive. Write to us with the country, the budget and the name of the complex if you already have one: we will look at it and tell you what we find.
Can a foreign developer be checked from abroad?
Most of it, yes. The company register, court records, the list of completed projects and resale prices in its complexes can all be checked remotely. Land documents and permits are requested from the company itself.
Why do online reviews not help?
Some reviews are written by the developer, some by competitors, and negative ones exist for good companies too. What you check are registers, permits and the record of completed projects.
What does a single project company mean?
It is common practice and not bad in itself. But only that company answers under the contract, not a group, and its capital is all it has. That goes into the risk assessment.
What is iskan in Turkey?
The habitation permit for a building. Without it an apartment cannot be connected to utilities officially and sells poorly afterwards. Whether the building will receive it is checked before the purchase.
Where should the money be paid?
It is safer when payments go through escrow or a notarial deposit. In some countries that is mandatory and in others it is not, and there you pay into a company account: a different level of protection, and one to know in advance.
We will shortlist options for your budget and guide the deal from the first viewing to signing.
