the illusion of a own home and the facilities that are “offered” today, motivates many people to get involved in some Real estate project, of the many that are built in the country, without imagining that the process is not as simple and easy as it is seen in the promotional pamphlets or as the real estate consultants or construction companies paint it.
“Separate it with US$500 and complete the initial payment in comfortable installments”, this is how José Manuel got involved in a real estate project still to be built or in plan, without having all the needed information to fully understand the process and without knowing the contract that almost a month later he would have to sign, after paying the US$500 and the 10% separation fee.
He says that, after depositing the first US$500, he was informed that the construction company gave an estimate of 28 days to complete the separation of the property for US$10,500 more. When complying with the transfers and your request, a model of your contract was shared with you, without it containing the particulars of your case.
José Manuel was summoned to sign his contract, a 12-page document, which he had not read in detail because it had not been delivered to him in advance so that he could read it calmly and be aware of each of his commitments.
As well as José Manuel, many home buyers sign contracts without being clearly aware of all that this implies or not even imaginingas is the case of María Eugenia Santos, who after signing the contract, the clauses it contains can allow the construction company several in her favor the conditions agreed at the beginning and even raise the cost of the property by more than 50%.
“These contracts are terrifying for the acquirer and there is no public institution that ensures that these are more equitable or balanced with risk, not even Proconsumidor, because it intervenes when the problem is already created, to reconcile, but why is there no obligation for contracts to be approved by an entity that balances the rights of the builder and the purchaser on an equal footing”, says María Eugenia.
“I found out about the project on Instagram and immediately contacted the construction company. We had already seen many projects and some people had given us a very good reference from the construction company, however, lAfter we paid the initial and we are almost on the date that the apartment is delivered to us, they notified us of an increase of 33%almost a million pesos more than what was agreed, ”explains the lady to Listín Diario.
Analysis of a real estate contract
The legal terms used by real estate contracts are not fully understood by many people, but let’s see what a real estate purchase and sale contractto which this medium had access, states in some of its clauses verbatim.
“It is agreed in this contract that in the event that, at the time of duly finished delivery, THE PROPERTY results in a construction area of less than the number of meters estimated in this contract, THE DEVELOPER shall not be obliged to reduce the sale price in whatever proportion may be appropriate. Likewise, THE BUYER acknowledges and accepts that if the construction area of THE PROPERTY is greater than the number of square meters estimated in this contract, THE DEVELOPER may increase the agreed price by the proportion or number of additional meters”.
This is a clause that breaks with the principle that “what is equal is not advantage”, In other words, what is the same for the seller must also be the same for the buyer. If the construction company demands a higher amount if the property has more square meters than agreed, it must also be willing to reduce the cost in case the agreed meters are less.
Another contract analyzed states that “THE PROMISING BUYER accepts that THE PROMISING SELLER may vary at its discretion or because it is required by the competent government and municipal authorities, modify the design, distribution, specifications, as well as any of the materials to be used in the project, provided that these modifications do not substantially affect the project or the apartment object of this contract”.
This means that the construction company can justify any change in the property in the design, distribution or in the materials without the acquirer being able to file a legal claim for it, as long as they do not “substantially” affect the project, something that will depend on the criteria with which it is evaluated.
That same contract indicates that “the sale price of the apartment contained in this contract is accepted by THE PARTIES with the understanding that it could be modified, if there were changes in the prices of materials, the remuneration of labor to be used in it, devaluation in our monetary sign or any other cause not attributable to THE PROMINENT SELLER. In which case, the PROMINENT SELLER will notify the PROMINENT BUYER of the justified cause by email or mobile messaging services”.
This is the paragraph where the construction company justifies without any limit or equity the transfer of all the risk of the execution of the work to the purchaser, without anyone defending it.
Imbalance
Due to space limitations, it is not possible to show all the articles, paragraphs or clauses of the analyzed contracts, however, there are many that penalize any type of delay of the acquirer, imposing delays and making explicit the right of the construction company to terminate the contract without need for judicial intervention. Likewise, the number of items justifying the delays or changes that the construction company could incur is notorious.