Expenses and the process of buying and selling an apartment on the primary market (new building) and secondary market differ significantly. If you are in the process of searching for your housing, we recommend familiarizing yourself to be fully prepared!
Expenses when buying a new building in Odesa
When purchasing a new building, the contract is concluded between the Buyer and the Developer company in a simple written form. Notarization of such a contract is not required. The Buyer acts as an investor of the real estate object under construction.
After construction is completed, the ownership right to the apartment is registered in the registry in the Buyer's name. The cost depends on the apartment's area and ranges from 650 to 1000 hryvnias.
More details about the process and cost of registering ownership rights can be found in our article
Registering ownership of an apartment in a new building. Step-by-step algorithm
Expenses when buying an apartment in Odesa
Notarization of the purchase-sale contract
Purchase-sale contracts for apartments on the secondary market mandatorily require notarization, and the parties to the contract bear the costs of notary services. The cost of such services in Odesa, at the time of writing this article (summer 2018), is approximately 4000 hryvnias and is determined by agreement with the notary.
Independent expert appraisal of real estate
Before signing the contract, an independent expert appraisal of the real estate is mandatory. As a result, the appraised value of the apartment will be determined. The cost of the appraiser's services is about 1000 hryvnias.
State duty
According to the Cabinet of Ministers of Ukraine decree “On State Duty”, payment of the duty in the amount of 1% of the value of the sold real estate object is provided.
Pension Fund contribution
According to the Law of Ukraine “On the Collection for Mandatory State Pension Insurance”, the buyer is obliged to pay 1% of the cost of the purchased apartment.
By the way, regarding the amount
property tax - in our article
Three main changes to property tax in 2016!
Income tax
Article 172 of the Tax Code of Ukraine defines the procedure for taxation of real estate transactions. The income tax rate for individuals is set at 5% of the contract price of the apartment, but not lower than the appraised value. Sellers who make the first sale of real estate within a year, provided they have owned it for at least 3 years, are exempt from this tax.
Military levy
Transitional provisions of the Tax Code of Ukraine introduced a temporary additional tax - military levy at a rate of 1.5%. As of the writing of this article (June 2018), collection of this levy has not been cancelled. It is levied in the same cases where income tax for individuals is levied.
Sometimes, in order to reduce expenses in a transaction, the parties resort to understating the appraised value of the apartment and formalizing the purchase-sale transaction at such an understated value. This practice carries certain risks for the property buyer. Before taking such a step, it is necessary to thoroughly check the entire ownership history of this object and its previous owners.
Bank commission
Another point - conducting settlements between the Buyer and the Seller. According to the “Regulation on
