Real Estate Sale and Purchase Agreement

This text explains the procedure for completing a real estate sale and purchase, which our clients go through with us without too much hassle or running around. However, it is good for each party to know, step by step, exactly what is done during the transaction, and the sale and purchase agreement is one of the main steps in the process of buying and selling real estate.

The law requires that a real estate sale and purchase agreement be concluded in writing, and by this agreement the buyer undertakes to pay the seller the entire agreed purchase price. Likewise, by signing the sale and purchase agreement, the seller is obliged to hand over possession of the property to the buyer and to issue a document on the basis of which the buyer will be registered as the owner in the land registry (zemljišne knjige).

What to pay attention to before signing a real estate sale and purchase agreement?

Before deciding to buy a property, it is very important for a prospective buyer to check that all the conditions for purchasing that particular property have been met. This means verifying the ownership of the property as recorded in the land registry (zemljišna knjiga) of the municipal court in whose area the property is located. To do so, one simply needs to apply for a land registry extract, which is the only proof of ownership of a property and also provides information on any other rights that may be entered in the land registry. It is also advisable to ask the prospective seller for the property's energy performance certificate, if one exists. The energy certificate is a document stating the energy performance of a building, issued by persons authorised to carry out energy certification.

Property Sale and Purchase Agreement – Form and Content

A property sale and purchase agreement must always be in writing. The reason for this requirement is that buying a property and the sale and purchase agreement itself are matters of great importance, and any consequences cannot be resolved without a physical written agreement. Concluding such a legal transaction orally would be absurd and also difficult to prove. The property sale and purchase agreement must contain a description of and details about the property that is the subject of the agreement, the price the buyer is obliged to pay the seller, the obligations of the seller and the buyer, and the information required to register the ownership rights in the land registry. The details of the buyer and the seller must be stated, namely first name, surname, address and OIB (personal identification number). As already mentioned, the seller's obligation is to hand over possession of the property to the buyer and to issue a registrable deed (tabularna isprava) for entry in the land registry, while the buyer's obligation is to pay the purchase price.

When concluding a property sale and purchase agreement, the seller's signature on the agreement must be certified by a notary public. After the agreement has been concluded, the buyer is obliged to report the acquisition of the property to the competent branch office of the Tax Administration in the area where the property is located, for the purpose of paying real estate transfer tax.

Registering Property Ownership After Concluding the Sale and Purchase Agreement

To acquire ownership of a property on the basis of a sale and purchase agreement, it is not enough simply to conclude the agreement; the buyer must also be entered in the land registry as the owner of the property. Registration is carried out on the basis of a registrable deed (tabularna isprava). This may be the sale and purchase agreement itself, if it contains a clause stating that the agreement may serve as the basis for registration in the land registry, or a separate document containing the owner's declaration permitting the registration of ownership of the property that is the subject of the agreement.

For any further questions, clarifications or assistance with the transaction process, please feel free to contact us with confidence via the CONTACT form or by phone at 01/ 429 0800.