Volodymyr Gurlov
Managing partner

Don't know how to get the license? I can help you with it!

Legal consultation
HomePublicationsRepresentative experienceWhat are the common property scams or frauds in Ukraine, and how can I avoid them?

What are the common property scams or frauds in Ukraine, and how can I avoid them?

Views: 569

For foreigners looking to invest in property in Ukraine, the prospect of owning a piece of this beautiful country is undoubtedly appealing. However, as with any real estate market, there are potential pitfalls, including scams and fraudulent schemes. In this article, we will explore some common property scams in Ukraine and provide guidance on how to avoid them to protect your investment.

Related article: What apartment do you need to buy to get the right to live in Ukraine?

Common Property Scams in Ukraine

  • Title Fraud: This scam often involves fraudulent sellers who claim to own a property they do not. To avoid this, conduct a thorough title search with a qualified Ukrainian attorney to confirm the property's true ownership.
  • Forged Documents: Fraudsters may provide fake property documents, such as titles or permits. Always have documents independently verified by a legal expert.
  • False Valuations: Some sellers inflate property values, leading buyers to overpay for a property. Obtain a professional appraisal to ensure you're paying a fair price.
  • Off-Plan Scams: In off-plan developments, fraudsters may take deposits for non-existent properties. Ensure the developer is reputable and has a track record of delivering on promises.
  • Bait and Switch: In this scheme, a different property is shown to you than the one you were interested in. Always visit the property and double-check the details.
  • Misrepresenting Property Condition: Sellers might downplay or hide significant issues with the property. Hire a qualified inspector to uncover any hidden problems.
  • Unlicensed Agents: Ensure that your real estate agent is licensed and reputable, as unlicensed agents may not have your best interests at heart.

Based on our practice of supporting real estate transactions, we can say that the most common types of fraud are usually the simplest. This is a situation with the owner of an apartment, when there are several of them, or with permission from the owner’s spouse. In the first case, it often turns out that there is more than one owner in the apartment, but only one can come to the transaction, and the second one is abroad or something else, and the transaction will be carried out by proxy.

In such a situation, it is necessary to extremely carefully and carefully check not only the power of attorney itself, but also the authenticity of the ownership rights of all owners. Of course, this problem can be solved very simply by in-depth inspection of the property before selling. If this is not done, it may turn out that the second owner revoked his power of attorney long ago and the apartment was sold to you illegally.

The second option is with permission from the second spouse. Essentially, the situation is the same, because in Ukraine, according to the law, jointly acquired property in marriage is considered common, and even if the wife/husband is not listed as the owner, permission from them is required when selling real estate.

Related article: Are there any restrictions on buying property in Ukraine?

How to Avoid Property Scams in Ukraine

  • Hire a Local Attorney: It's essential to have a trustworthy, local attorney who specializes in real estate transactions. They can perform due diligence on the property, review documents, and guide you through the process.
  • Verify Property Documents: Double-check all property documents, including titles, permits, and ownership records, with the assistance of your attorney.
  • Use Reputable Real Estate Agents: Choose real estate agents with a solid track record and positive client testimonials. Verify their licenses and credentials.
  • Visit the Property: Always physically visit the property you plan to buy. This helps you ensure it matches the description and photos.
  • Get an Independent Appraisal: Have the property independently appraised by a certified appraiser to determine its actual market value.
  • Research the Seller and Developer: Investigate the background and reputation of the seller and developer. Look for previous successful projects and satisfied customers.
  • Secure a Legal Contract: Ensure that all agreements are documented in a legally binding contract. Your attorney can help draft and review these documents to protect your interests.
  • Be Cautious with Cash Payments: Avoid making cash payments and opt for traceable methods, such as bank transfers or checks. This creates a paper trail and reduces the risk of fraud.
  • Stay Informed: Keep yourself updated on the latest property laws and regulations in Ukraine, as they can change over time.
  • Trust Your Instincts: If something seems too good to be true, it probably is. If you have doubts about a property or a deal, seek further guidance and advice.

Of course, if you complete the first item on this list, your responsibility for all subsequent ones will be transferred to the shoulders of the lawyer. So, when working with clients, we independently check everything related to real estate, and recommend a trusted realtor and notary. And most importantly, we remain in touch with the client after the transaction, because the services of a migration or tax lawyer may be needed so that the transaction has the maximum positive effect and meets the interests of our client.

We also help with paperwork, including remotely obtaining a TIN in Ukraine. If you wish, the entire procedure can be organized remotely.

Investing in Ukrainian property can be a rewarding experience, but it's essential to be cautious and thorough in your due diligence. By following these tips and working with reputable professionals, you can significantly reduce the risk of falling victim to property scams and make a sound investment in the beautiful country of Ukraine.

You can find out everything about purchasing real estate in Ukraine here.

Contact our specialists for a safe and comfortable purchase of real estate in Ukraine.

Views: 569