54% of residential complexes under construction in Ukraine have lawsuits regarding land plots. However, these are not the biggest problems you encounter when trying to buy a home in a new building. This is stated in the Opendatabot study.
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Problems with new buildings
Among the nearly four hundred new developments analyzed, 214 residential complexes have claims regarding the land on which they are built. The developers of another 22 residential complexes did not renew the lease of the land plot. However, the most critical situation in 9 future complexes is that the Register of Rights lacks information about the connection between land and construction.
“The absence of any permits, rights to land or improper land use at the time when a new building is being built is an opportunity for corruption when the building is put into operation. Even later, when people will already live in it. After all, it is almost impossible to solve such problems legally later, when people have already invested their money.
Now we see the main risks in the land, so the first study is focused on these issues,” comments Alexey Ivankin, founder Opendatabot.
Main risks
The main risks of housing not put into operation at any stage of construction, creating opportunities for corruption, include:
- lack of construction permits; the customer lacks ownership or use rights to the land plot; lease agreements for land plots expiring in the near future; inconsistency with the intended purpose of the land plot – that is, a residential building cannot be built on this site at all; the presence of court cases and arrests on land plots; non-compliance of construction with urban planning conditions (number of floors and height).
Research methodology
To obtain and collect information about all houses under construction in Ukraine, Opendatabot analyzed open data from the Register of Construction Activities, the Unified State Register of Court Decisions, the State Land Cadastre, financial statements and public information on requests from the Unified State Register and the State Register of Property Rights to Real Estate of Ukraine.
Data on all new buildings in the country was collected in the “Opendatabot” project. Corruption risks of new buildings.”
- Real estate