A contract must be signed when buying a home. To hedge risks, the contract should be drawn up by a notary, even if the real estate is purchased directly from the owner. The notary shall verify the information necessary for notarizing the transaction and represent the parties to the transaction in dealings with the land registry department.

If you wish to have your real estate appraised, you may use certified appraisers from the Estonian Association of Real Estate Appraisers. It is easiest to buy and sell an apartment or building – i.e. real estate – through a certified real estate agent. The realtor’s commission is usually included in the sales price of the dwelling. Estonian real estate companies have established a professional association: the Estonian Association of Real Estate Firms.

Things to verify when buying an apartment:

  • Is the seller the owner of the apartment and what is the form of ownership of the apartment you intend to buy. If it is an apartment ownership, then the land is registered and the apartment is a physical share of the residential building.
  • Does the building have an apartment association. Ask the apartment association whether the apartment you are buying has any indebtedness.
  • Make sure the apartment has no tenant, including tenants entitled to live there under a pre-restitution grandfather clause. If you discover that people you do not know are registered as living in an apartment recently purchased by you, you have the right to submit a notice for changing the address data in the Population Register. For more information, visit the useful links in the right-hand menu.
  • What are other living expenses.

Entering into the contract of purchase and sale

Before entering into the contract, the parties must agree on who pays the notary fee and the number and size of the instalments for paying the purchase price. Also, negotiate the closing date – the date on which control of the dwelling is to be transferred, including the date on which the previous inhabitants will register themselves as having moved out.

Necessary documents for closing the sale transaction

In the case of an individual:

  • Identity document;
  • if the seller bought the property while married, the seller’s marriage certificate (both spouses must take part in signing the contract or one spouse may use a power of attorney from a notary);
  • if the buyer is married and buys the property with a bank loan, the buyer’s marriage license is required (both spouses must take part in signing the contract or one spouse may use a power of attorney from a notary).

In the case of a buyer or seller who is a legal person entered in the Commercial Register:

  • An identity document for the member of the management board.
  • A resolution of the shareholders or supervisory board regarding purchase or sale of the object along with their address, details for the seller (buyer), sales price).

Land Register

All immovable properties (plots of land, apartment ownerships, building rights and rights of superficies in apartments) are entered in the Land Register. Ownership relations concerning an immovable property are also entered in the Land Register. The Land Register ensures legal certainty of immovable property ownership and minimises risks related to immovable property transactions. The Land Register is maintained at land registry departments of county courts. Data entered in the Land Register can be viewed electronically in the query system of e-Land Register query system.

Apartment associations

An apartment association is a non-profit association established by apartment owners aimed at the cooperative management of apartment ownership and representing the common interests of apartment association members. An apartment association may be founded by one building or several buildings, but only within the boundaries of one registered immovable. Founding an apartment association takes place on the basis of a majority decision of the apartment owners. An apartment association may be founded only if its prospective founders are the owners of the relevant apartments.

A housing association is different from an apartment association in the sense that in a housing association, the residential building, including the apartments, belong to the housing association. In an apartment association, the owners of the residential building are the apartment owners.

Apartment associations and communities of apartment owners may take a loan for renovating the building with a surety from KredEx for new apartment buildings. A KredEx surety guarantees up to 75% of the principal of the loan to an association or community, thus significantly hedging the bank’s risks. A KredEx surety also helps resolve temporary payment problems experienced by an association or community without the apartment building as a whole becoming a debtor to the bank. If particular apartment owners develop a problem paying instalments, KredEx can pay the loan payments for up to 12 months on the basis of request from the apartment owner or association.

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