And there you go! The deal is sealed, the purchase agreement for your (former) property is signed and sealed. And now, as the seller, you’ve got one last task to perform – passing on the apartment or house to its new owners. But how exactly does property transfer work in the Czech Republic?
The process of handing over your apartment or house is just as important as the sale itself. Why? And what are the things you need for a smooth handover? We’ve got the lowdown for you in our article.
When does property transfer happen in the Czech Republic?
When does the handover happen after you’ve sold your property? This is all clearly set out in a well-drafted purchase agreement. Typically, there are three possible timeframes for the property handover in the Czech Republic:
- A timeframe tied to the completion of the transfer of the apartment or house in the land register (in legal terms, this is the registration of ownership rights in favour of the buyer). The handover usually takes place within 5 to 10 business days after the transfer is registered in the land register. This approach is usually the most common choice for property sales in the Czech Republic.
- A timeframe tied to the delivery of the purchase agreement to the land register (again, in legal terms, this is the submission of the proposal to register ownership rights in favour of the buyer). The handover timeframe is also typically 5 to 10 business days, but this time after the purchase agreement has been submitted to the land register. This approach is often used in the Czech Republic when the apartment or house is already vacant, and the seller wants to wrap things up quickly – for example, to avoid ongoing ownership-related costs (such as repair funds, services, etc.). The downside is, at that point, it’s uncertain whether the registration in the land register will go smoothly and ensure a successful deal. However, in most cases, the registration process is successful.
- A timeframe tied to the money from the sale of the apartment or house being credited to your account. The handover timeframe is usually around 5 business days after the money hits your account. This type of timeframe is less common in the Czech Republic. Buyers often aren’t keen on this arrangement, arguing that they’ve fulfilled their part by putting the money into escrow. Furthermore, it’s not a major advantage for sellers. If, in theory, the money doesn’t make it to the seller, they’ve already lost ownership, and the new owner would have to seek legal action to access and use the apartment or house. So, it’s essential to choose a secure escrow solution to ensure the money ends up where it should. You could also tailor the timeframes; for instance, you might release the escrowed funds 5 business days after the transfer and wait another 10 business days before handing over the property. This way, you’ll only pass on the property when you’ve got the funds safely in your account.
In the Czech Republic, an important aspect connected with the handover period is the responsibility for damage to real estate, including any costs related to, for example, an insurance claim, etc. This means that until the property is transferred, even after it’s officially registered in the cadastre (land register), you as the seller are the one responsible.
By the way, for holding funds during the period between signing the purchase agreement and registering the property in the cadastre, we use a something called escrow. Wondering what that is and how to pick the right type? Then take a look at our article “Types of escrow in the Czech Republic and their advantages and disadvantages“, which gives you all the information you need.
What should be included in a property handover protocol
For the handover of an apartment or house, you’ll need what’s known as a property handover protocol. What exactly should it contain?
In the Czech Republic, this document is as important as the purchase agreement itself. Once signed, the new owner can’t make claims about anything which is not mentioned in it. The property handover protocol essentially describes the condition of the property at the time of handover to the new owner. Alongside details of both the transferring and receiving parties, it should also cover all the property’s information, ideally specified just as it is in the purchase agreement.
Furthermore, the handover protocol must list all the furnished items that are being transferred along with the property (such as a couch, cabinets, kitchen units, appliances, etc.). Also, record the number of keys being handed over (and specify which doors they belong to).
Don’t forget to also note down the meter identification numbers and readings (cold and sometimes hot water meters), heating, electricity meter, and gas meter readings as of the handover date. It’s a good idea to complement the apartment or house handover protocol with photographic documentation that clearly shows the property’s condition, furnishings, and meter readings. By the way, a similar protocol is filled out when ending a lease in the Czech Republic.
Another crucial part of a proper handover protocol is a section where the buyer can list any defects in the property at the time of handover. If the buyer didn’t find any issues during the handover, they should note that the property was handed over without defects.
Are you curious about property taxes when selling a property? You can find out more in the articles “Property sales tax” or our guide to “Income tax exemption when using the proceeds of a sale to purchase another property“.
Where can you get a property handover protocol in the Czech Republic?
After reading the above, you’ll probably realize that drafting a property handover protocol during a sale isn’t exactly a simple task for a layperson! After all, attempting to create this document on your own could backfire if you overlook something important. That’s why it’s wiser to leave the drafting of the handover protocol for an apartment or house to the experts.
If you sold your property in the Czech Republic through a real estate agency, then your broker will undoubtedly provide you with a handover protocol as part of their services.
If you’re selling your property independently or have reasons not to use the provided protocol, we offer a free downloadable template for a property handover protocol for an apartment or house. This sample handover protocol contains all the necessary details to ensure a seamless property transfer after the sale.
Need advice on selling an apartment, house, or land? At KOTULA Prague Realtor, we’ll guide you through the entire selling process, handle all the necessities on your behalf, and ensure your property sale reaches a happy ending. Contact us!
Photo: Robert Kneschke via Canva.com
