How to evaluate the degree of reliability of the builder?
We are often asked, but this question is very difficult to answer. In any development project, buying an area under construction is inherently a risk-bearing operation because it represents the so-called A futures contract, according to which the parties promise each other to fulfill their obligations in the future.
On the other hand, precisely for the reason that this operation carries risk, the area under construction is much more affordable than the finished one. Therefore, as consumers, we have to make a choice. And the more informed this choice is, the more likely the right decision will be.
The market easily forgets the past defaults, bankrupt projects, delayed constructions, stories of disappointment... but our cities are full of frozen or slow-moving constructions.
That is why we decided to look at the problem more methodically, and to establish the sources from which it is possible to find very valuable information for making even a public but healthy decision. Here is a list of information sources:
1. Extract from the public register.
A land extract from the public register carries important information, and can answer questions such as:
- Whether the property is seized;
- What obligations does the property carry (bank, previous owner of the land...);
- whose land is it (Sometimes it happens that the land is not even formalized and they start selling it).
It is also possible to update your statement electronically, and you may not even need to update it because the new one is updated.
ასევე ხშირად ამონაწერში მითითებულია კონტრაქტები ვალდებულებების შესახებ, ბანკის ან მიწის წინა მესაკუთრის მიმართ, რომელთა გამოთხოვა, დაინტერესების შემთხვევაში, შეგიძლიათ საჯარო რეესტრიდან (გარკვეულ ფასად).
2. tas.ge – Tbilisi City Hall website
This site features architectural designs and a chronology of building permits, allowing you to see:
- Dated photos: When approving the project, correcting it, or obtaining a construction permit, the builder is obliged to take and date a photo. Such photos allow to assess the speed of construction, which best shows the quality of construction management. The speed of construction is best seen at the reinforced concrete stage. There are builders who pour 2 above-ground floors per month, and builders who can't even pour one per month (note also that underground floors take twice as long on average as above-ground floors);
- Functional part of the project: It often happens when a permit is taken for hotel type apartments or offices and they are usually sold as apartments. The point is that both utility bills and the tax system act in different ways on areas of different purposes.
- Approved project parameters: We saw a case where a builder was selling a 9-story building, and had a 5-story building approved (probably selling in the hope of adjusting the project later). Also, often, the planning of a publicly registered project differs from the proposed one. Suppose 100 sq.m. is registered in public. apartment and the developer sells two 50 sq.m. apartment. This may cause problems in the future because the developer may not be able to adjust the project;
- building materials: The construction materials used are indicated in the approved project, by means of which you can more or less assess the quality of the project. In the future, we hope that the energy efficiency class will be declared, which will give us more valuable signs about the quality.
- Construction plan-schedule: The builder is obliged to determine the construction schedule in advance when obtaining the permit. With this document, you will be able to assess the extent to which Menashene's promise is in line with the plan-schedule declared in the City Hall (in which reserves are already provided so as not to be fined).
3. Social networks and web pages
If you are looking for a project under construction not in Tbilisi, but in another location, then it is more difficult to find information, because the official information channels are not functioning. Nevertheless, such information can be partially collected from the Internet pages of the builders themselves. We can assume that the more difficult the developer is, the more reliable the developer is. Using web pages and social networks, we can answer such questions as:
- What projects did Menashene do in the past?
- Are there historical projects completed and commissioned?
- Are there any suspicious comments from users on the Facebook page?
- Does the organization post construction photos regularly?
- When did the project go on sale? How much time has passed? How fast is it built?
- Are the construction dates specified? (If there is no essay, it will be late).
The contract itself that the organization offers gives very good signals about reliability. You should definitely read the contract and pay attention to such details as:
- What responsibility does the builder take for the delay?
- What details describe the quality of construction? Are there specifics?
- Does the builder take responsibility for putting the building into operation?
- Is the contract registered in the public register? Or when and under what conditions will it be registered?
- Will your new property be mortgaged? Or how and under what conditions will the financing bank's mortgage be removed?
5. Reportal.ge – financial reports
If you are interested, you can also access Menashene's financial accounts. But getting such information only makes sense if you can read it correctly. For example, if the profit/loss shows a loss at the first stage of the project construction, it does not mean that the project is unsuccessful, it may mean that the apartments sold have not yet been reflected in the income... Therefore, if you get this information (which in some cases is paid), you should show it to the financial specialist of the field and Avoid making independent conclusions.
If you are inconvenient to collect the information specified in the article, our managers can help. We will collect and provide you with the information that is available in the public space, as well as clarify the prices with additional data if you are interested.
The cost of the service is 50 GEL.
Disclaimer: Our service does not constitute financial advice. We simply collect and provide you with public information.