The difference between a developer agreement and a preliminary agreement is fundamental. To understand it clearly, the easiest way is to compare these agreements in three key areas: purpose, time of signing, and level of legal protection.
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Developer Agreement |
Preliminary Agreement |
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Basic Purpose |
Direct sale of a property that does not yet exist in a legal form (not yet separated/established). |
Promise to conclude a proper sales agreement in the future for a property that already exists (or in the case of a developer - is ready). |
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Typical Signing Time |
During the construction phase or before it begins. The apartment is "in the plans" or "under construction". |
Shortly before finalizing the transaction, when the property is ready for handover (primary market) or exists (secondary market). |
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Legal Form |
Always a notarial deed - statutory requirement (Act on Protection of Rights of Purchasers of Residential Premises). |
Notarial deed recommended for full protection, but a written form with a certain date is also permissible. |
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Key Security Feature |
Escrow account - funds deposited safely and released to the developer only after confirming progress of works. |
Deposit (Zadatek) - usually up to 10% of the price. Forfeited if you withdraw without cause; returned double if the seller is at fault. |
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Legal Basis |
Developer Act - imposes many protective requirements on the developer. |
Civil Code (Art. 389-399). Greater freedom in shaping the content. |
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Typical Market |
Almost exclusively the primary market (apartments from developers). |
Primary and secondary market (standard stage when buying "used" apartments). |
Developer Agreement
• You are buying a "promise" of an apartment. You commit to pay; the developer commits to build, establish, and transfer ownership.
• Strong statutory protection: right to withdraw in case of significant delay (over 90 days) or project changes.
• You pay according to a schedule; funds released after verification of construction stages.
Preliminary Agreement
• You reserve a specific, existing apartment until the notarial deed of sale is signed.
• Your security depends on the content of the agreement: precisely specify the deadline, property description, and consequences of non-performance.
• Does not constitute a transfer of ownership. The seller remains the owner until the notarial deed is signed.
Developer Agreement
INFORMATION PROSPECTUS
The developer is obliged to provide it. Read it carefully - it is the key source of information about the investment, risks, and the developer.
WITHDRAWAL CLAUSE
Check if the agreement explicitly reiterates your statutory right to withdraw in case of delays.
Preliminary Agreement
NOTARIAL FORM
Definitely choose a notarial deed - it provides the highest legal certainty and facilitates claiming rights.
FAIR DEPOSIT
Avoid clauses about a "non-refundable deposit" or a contractual penalty of disproportionately high value. Standard is up to 10% of the price.
SELLER VERIFICATION
Before signing, check the Land Register (KW) to confirm the signing person has the right to dispose of the property.
In summary: A Developer Agreement is the proper sales agreement for a future apartment, surrounded by numerous statutory protections. A Preliminary Agreement is a promise to sell an existing apartment, the strength of which depends on its carefully drafted terms.
On the problems of housing construction in 2023
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