• 2016.03.15
  • Buying and selling column

1. Firstly
We will advise precautions when buying and selling of real estate. People who look at this website are mostly clients who buy/sell condominiums. Therefore our explanations will deal mainly for sale of condominiums.

2. Condominium Management mechanisms

When you buying an apartment/condominium, you need to understand the mechanisms of the Condominium Management.

Since the ownership of condominium is made up of a number people, management of the common spaces such as entrance and stairs, repairs to the building, and when to demolish is to be decided and determined by everyone.
This mechanism of decision making by everyone has been determined by law.

Once you buy a condominium unit, you are automatically a condominium association member.
A condominium management union is organized from association members.
Management unions, must hold a General Assembly meeting at least once a year.
When there is an Association Meeting, the members are required to be present as much as possible.

However, for decisions on some minor items, holding a general meeting every time would be difficult for these matters. It is usual to organize the Board of Directors with a small number of people.
The Board will consist of, the President, Vice President, and directors.  Usually the directors are chosen during the management association meeting.

The Condominium management of rules are usually written in the management contract documents.
When you buy condominium, monthly payments for administrative expenses and repair reserve funds is required.
The condominium owners collectively decide on their own how much are the payments for the management expenses and repair reserve funds.

However, since it very difficult to carry out the Condominium Management by the management association and the Board of Directors, usually all the Condominium Management is entrusted to a company that specializes in this management.

Although it is said that the management is entrusted to a company, it is still the owners who decide on how to manage the condominium. 
Everything must not be left to the management company. It is in the best interest of the owners to understand the reports and recommendations of the condominium management company as well.

3. Real estate sales contract

Well, we've discussed the mechanism of the Condominium Management, now, we will explain the precautions when buying real estate.

If you decide to buy real estate, you will be entering into a purchase and sale agreement.
But in the case where the transactions are done thru an intermediary broker, prior to the conclusion of a sale and purchase agreement, you will be briefed by your broker on the important matters.
This is because the brokers who perform the mediation of residential land and buildings is required by law to explain the client on the important points of the contract.

When receiving the explanation on the important matters, please listen well to the contents of the explanation, and it is a good idea to ask questions to the broker on matters that are not clear.
Well, when you're done listening to the explanation of important matters, you can finally sign a purchase and sale agreement,  seal (inkan), and entered into a sale and purchase agreement 

After you have entered into a sale and purchase agreement, you must follow the terms of the agreement that has been written in the purchase and sale agreement. You therefore, prior to the conclusion of the sales contract, you must be sure to understand the contents of the sale and purchase agreement. For example, even if I want to cancel the contract, anything cannot be unilaterally canceled without reason. If you want to cancel the contract without reason, you must abandon the paid deposit which is usually stipulated in the terms of the agreement.

In addition, if there are defects discovered on the real estate property that was purchased, claim for damages against the seller can be done.  It is said that the seller shall take responsibility for any defects, but pursuing liability can be done during the buying and selling contract period which you need to confirm as well.  You must be careful because if you wait too long past its period, even if there is a defect in the real estate, you may not be able claim for damages.

4. In conclusion

We have explained matters about the condominium management, sale and purchase agreement. Please let the intermediary agency explain more in detail the contents of these agreements and please ask any questions on matters not clear to you.  In addition, for documents such as explanation of important information and purchase and sale agreement, it is important that you read thru it you sign anything.