5 Critical Mistakes to Avoid When Purchasing Real Estate

Purchasing real estate and acquiring ownership is an investment in our future, and investments must absolutely be legally and financially protected. Here is a list of 5 critical mistakes that a real estate buyer should avoid to ensure absolute financial security during the transaction. A separate article will be dedicated to purchasing real estate under construction;

Mistake 1: Believing the seller's claim regarding property registration without independent verification.
Solution: Verify the legal status of the real estate at the National Agency of Public Registry.
Rationale: Regardless of whether the property is a land plot or an apartment, it must be officially recorded in the database of the National Agency of Public Registry. Every real estate property possesses a unique cadastral code used for its precise identification. This procedure is essential to ascertain the property's legal and physical characteristics, to verify exactly what is being purchased, and to confirm the legitimate identity of the seller. This is imperative because, in my legal practice, there have been precedents where the buyer ultimately acquired an entirely different property than anticipated. Furthermore, the property might be subject to an injunction, seizure, or the owner might have an active tax lien or mortgage, which precludes the execution of a valid contract. In such instances, one risks losing not only time but also substantial financial resources;

Mistake 2: Foregoing a physical inspection based on satisfactory photos and videos.
Solution: Conduct a mandatory in-person inspection of the real estate.
Rationale: It is imperative to personally visit and physically inspect the property. If possible, conduct your own photographic and video documentation. Furthermore, it is advisable to interview the owners of adjacent land plots or neighboring apartments to determine if there are any ongoing property disputes. These actions are necessary to establish the legal foundation of a "bona fide purchaser," a key characteristic of which is the personal inspection and assessment of the property in question. In my practice, an opposing party failed to execute these actions, which served as the precise legal basis upon which my client successfully regained ownership rights to the real estate. Under no circumstances should one accept excuses such as "I don't have the keys right now" or "the apartment is locked." A personal inspection of every single room is mandatory. It was precisely my professional persistence as an attorney that saved a client when a real estate broker recommended purchasing a property still occupied by the previous owner, attempting to show the property solely from the interior of a vehicle. The ultimate advice remains: open the door, enter, inspect, take pictures, and record videos. Naturally, the broker may be disappointed, but such measures are non-negotiable;

Mistake 3: Assuming there is no need to update the Public Registry extract because the property is already registered.
Solution: Obtain an updated extract from the National Agency of Public Registry.
Rationale: Encumbrances such as judicial injunctions, seizures, tax liens, mortgages, and other liabilities do not automatically reflect on a property without a formal update of the registry extract. Consequently, an updated document allows you to definitively ascertain that the real estate is neither seized nor subject to any hidden legal obligations. By spending approximately 15 GEL, you can safeguard an investment of 100,000 GEL. It is undoubtedly prudent to invest 15 GEL to eliminate catastrophic risks to your 100,000 GEL capital;

Mistake 4: Failing to verify the property's history based merely on the seller's superficial statements.
Solution: Thoroughly investigate the legal history of the real estate in the Public Registry.
Rationale: It is strictly obligatory to review the property's legal history. If any suspicious elements or inconsistencies are detected within this history, a detailed inquiry with the seller is required. A property might not have a formal injunction or seizure recorded, yet it could still be the subject of active litigation. You must pose relevant questions and obtain definitive, verifiable answers. Additionally, there may be ongoing administrative disputes concerning the property. Investigating these matters ensures compliance with another core legal principle of bona fide purchasing: "investigate the past of the real estate." In practice, I have encountered a case where a buyer inspected a property via a video call but neglected to examine its legal history; it was later revealed that the former owner still resided in the property and was engaged in a bitter legal dispute with the new owner. Therefore, historical research is essential, especially considering it can be easily accomplished by accessing the relevant state portal via a mobile phone;

Mistake 5: Utilizing a standardized Public Registry template for the contract to avoid paying attorney fees.
Solution: Retain a qualified attorney for the drafting and execution of the purchase contract;
Rationale: This step is crucial to ensure your legal rights are maximally protected. The purchase agreement template provided by the National Agency of Public Registry is merely a standard, generic prototype wherein all terms are conditional and overly simplified. I recall a specific case where my client and I are still embroiled in ongoing litigation due to the use of that very template. The document contained the standard boilerplate phrase "the sum has been paid in full," an obligation my client had indeed fulfilled; however, the opposing party now argues that only a "partial payment was made." Consequently, a lengthy and costly dispute continues solely because of this generic provision. Had an attorney drafted the contract, they would have explicitly specified the terms of payment, the exact method, the precise deadlines, and other vital clauses. Furthermore, an attorney's fee for drafting a contract is not an exorbitantly large sum. Given that real estate transactions are infrequent and represent massive capital investments, it is far more sensible and economical to rely on professional legal expertise;

You can execute these steps without an attorney, either sequentially or non-sequentially; however, it is highly recommended to undertake these procedures alongside an attorney or delegate them entirely to a legal professional. Doing so will provide you with peace of mind and comprehensively guarantee your financial security;