Buying a Czech new-build: contract and handover checks

The showroom is finished, but your apartment may still be a drawing. You are committing money today for a unit whose dimensions, materials, timing, financing and legal registration will develop over months or years. The contract must control that journey before the polished final purchase agreement arrives.

Map the transaction, not only the floor plan

Assign a responsible party, document, deadline and failure consequence to every arrow. Developer brochures usually describe the destination; buyers need evidence for each intermediate step.

1. Check the exact company and its right to deliver the project

• Legal entity signing each agreement, its company number and signing authority.
• Whether the landowner, developer, seller and payment recipient are the same or connected entities.
• Company history, filed accounts and material changes in the official company register.
• Current insolvency search for the contracting entity and relevant project companies.
• Land ownership, project-finance liens, easements, prohibitions and pending filings.
• The current building permission, its holder, finality, approved project and the route to an occupancy decision.

Verify companies through the official Czech public register, check the insolvency register, and inspect the project land in the cadastral viewer. A recognised brand can market a project while a separate single-project company owns the land and signs your contract. Your rights are against the entity in the documents.

2. Define the future unit so it survives design changes

• Unit number or provisional identifier, building, floor, orientation and boundaries.
• Method used to calculate internal area and treatment of partitions, shafts, balconies and terraces.
• Permitted area tolerance and exact price increase, reduction or withdrawal consequence.
• Parking and storage legal form: separate unit, share, easement, licence or allocated common area.
• Room plan, socket and service positions, finishes, equipment and measurable performance standards.

Marketing labels such as “premium standard” are difficult to enforce. Put the product, grade, dimension or objectively equivalent performance into an annex. State which drawing prevails if the sales plan, technical drawing and contract differ.

3. Limit unilateral substitutions and project changes

Construction requires some flexibility, but a broad right to change layout, materials, common areas or landscaping can transfer most design risk to the buyer. Separate minor technical substitutions from material changes affecting area, use, value, light, view, access, parking or operating costs.

Where an individual buys from a developer as a consumer, Civil Code sections 1813–1815 also matter. The statutory list includes terms allowing the business to change the parties’ rights or duties at its own discretion, decide unilaterally whether performance conforms, or impose a disproportionate sanction on the consumer. Whether a particular project clause is abusive still depends on its wording, the other agreements and the circumstances at signing.

• Define “equivalent” by quality and performance, not solely by developer judgment.
• Require written notice with an updated drawing, reason and price or timing effect.
• State which changes require buyer consent and which permit price reduction or exit.
• Record client changes separately with their price, drawing, approval and programme impact.

4. Follow every staged payment and the risk it funds

A milestone schedule should state who certifies progress, what document triggers payment, where the money goes and what protects it if the project stops. “Shell completed” needs objective evidence. A payment directly to a project company is not the same protection as escrow, a bank-backed structure or another agreed safeguard.

• How the reservation amount is credited and when it can be retained or returned.
• Whether payments reduce a project-finance loan and how the bank releases the unit from its lien.
• What happens to paid money if a permit, construction, financing or sale condition fails.
• Whether the buyer can suspend a disputed milestone without immediately losing the contract.
• The final amount retained until agreed delivery evidence or defect cure, if negotiated.

5. Turn “completion” into a chain of dated events

Construction completion, permission for use, creation of the unit, invitation to sign, cadastral ownership and physical handover are different events. Define each one and give the project a true long-stop date—not only an estimated quarter that can move whenever the developer invokes a broad extension clause.

Under sections 230–235 of the current Building Act, a permitted building may generally be used only under an occupancy decision and for its approved purpose; the exception for simple structures expressly does not cover simple residential buildings. The authority assesses whether the completed work, or an independently usable part, complies with the permission. Do not let “finished”, “ready for inspection” and “approved for use” become interchangeable contract triggers.

• Specific permitted extensions, evidence and maximum duration.
• Notice timing for delay and an updated binding programme.
• Buyer costs caused by delay, balanced penalties and a meaningful exit point.
• Refund amount, interest or documented cost treatment and repayment deadline after exit.

If a binding date has already been missed, use the developer-delay evidence, mortgage, penalty and exit guide before accepting a revised timetable or signing an amendment.

6. Make the mortgage work at the future completion date

An indicative mortgage today may not survive a delayed handover, changed buyer income, expiring rate offer or bank valuation below the final price. Confirm how long approval lasts, when the bank values an unfinished unit, which documents enable drawdown and how project and buyer-bank liens are ordered.

Connect financing conditions to the reservation refund rules. If approval fails, use the mortgage-rejection response planrather than assuming the developer must automatically return every payment.

7. Treat the future purchase agreement as the main negotiation

A future agreement is binding, not an informal placeholder. Civil Code sections 1785–1788 require the promised contract to be defined at least generally. The obligated party must conclude it without undue delay after a timely contractual call; if it refuses, the entitled party may ask a court or the agreed person to determine the future contract’s content. But a late call extinguishes that duty, and a sufficiently fundamental change of the assumed circumstances can also extinguish it, subject to prompt notice and possible damages. The agreement should therefore say exactly who calls, how, by when and with which completed documents.

• Attach or tightly define the final purchase agreement rather than postponing essential terms.
• List conditions that must be satisfied before the buyer can be called to sign.
• Give adequate notice and a realistic signing window compatible with the bank.
• Prevent the final form from introducing new burdens, waivers or payment triggers.
• Define assignment or resale restrictions if your circumstances change before completion.

8. Inspect before handover and distinguish defect categories

Bring an independent technical inspector to the pre-handover visit where permitted. Test windows, doors, surfaces, falls, water, drainage, ventilation, heating, sockets, controls, meter identifiers and the agreed equipment. Record each defect with location, photograph, responsible party and cure deadline.

Define which serious defects allow the buyer to refuse handover and which minor defects are recorded for later cure. Receiving keys, signing a protocol, accepting ownership and waiving claims are not the same act. If problems appear later, follow the hidden-defect evidence and notice plan promptly.

9. Budget the building after the sales team leaves

• Draft owner declaration, common-area definition and exclusive-use rights.
• Initial service budget, reserve contributions, metering and energy arrangements.
• Who controls the owners’ association initially and contracts already signed for it.
• Warranties, manuals, revisions, as-built records and the defect-reporting channel.
• Unfinished later phases, shared facilities and construction disruption after your handover.

If the sales team wants a reservation today