Although basically a development agreement guarantees price stability, the law provides for some exceptions. The developer can legally raise the price of the apartment in two specific situations. The first is Changing the VAT rate – If the legislator decides to increase this tax, the developer has the right to transfer an additional cost to the buyer in accordance with the new tax regulations.
The second situation applies to the difference in the area of the apartment. It can happen, especially when buying a flat in a building still in the construction phase that The final area of the premises will prove to be greater than expected in the contract. In this case, the developer can increase the price proportionallybut he must provide the buyer with detailed explanations and documents confirming the increased area.
The key is, however, that both of these situations must be transparently included in the contract as early as it is signed. The developer cannot refer to them post factum if they have not been previously provided in the contract.
Unfounded increases are a violation of law
Developers are much more likely to try to raise prices unjustly, which is unlawful. Increase in labor costs, a minimum national salary increase or even a drastic increase in the prices of building materials cannot be a reason to increase the price of the apartment. The provisions in the contract are binding and are to protect the interests of buyers from unpredictable changes on the market.
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If there is none in the contract valorisation clause, the developer may not request a higher amount than that resulting directly from the contract. Any attempt at such action is a violation of contractual obligations and may be the basis for submitting a complaint or even withdrawal from the contract.
Valorisation clauses – legal but requiring attention
Aware of difficulties in predicting construction costs, some developers secure themselves by placing in contracts valorisation clauses. They allow you to increase the price of an apartment in specific situations, most often related to an increase in the costs of building materials or other external factors affecting the investment process.
The introduction of such a clause is not unlawful – this is confirmed by the analysis of the case -law and the position of the Office of Competition and Consumer Protection. However, for the buyer it means The need for special caution when signing the contract. The clause must be formulated clearly and precisely to determine the situations in which the price increase may occur.
How to protect yourself against unforeseen costs
The best protection against unexpected increases is a thorough analysis of the contract before signing it, preferably with the help of a legal advisor. Any record regarding the possibility of changing the price should be analyzed in detail. The buyer has the right to negotiate the terms of the contract, including clauses, which he considers unfavorable for his interests.
It is worth paying attention to the precise formulation of the conditions in which valorisation may occur, and on The upper limit of such a raise. Some contracts provide for the possibility of increasing the price by up to several dozen percent, which can significantly affect the investment budget.
What to do in case of a raise
If the developer informs about the price increase, the buyer has the right to detailed explanations. The company must provide documents justifying the increase in costs and show that the increase is in line with the contractual provisions. In case of doubt, it is worth consulting a lawyer who will help assess whether the developer's action is justified.
It is also important that The buyer has the right to withdraw from the contract if the developer raises the price of the apartment. This option can be particularly attractive if the increase is significant or if more favorable offers have appeared on the market. If the increase turns out to be unfounded, The buyer may submit a written complaint and demand the main price.
Why developers raise prices
The reasons for increases in housing prices during construction are understandable from a business perspective. The construction industry is struggling with high instability of material costs – the prices of steel, concrete or insulation materials can increase two or three times within a few months. Additionally Problems with the availability of some raw materials extend the construction time, which also affects the final investment costs.
For developers who have to plan investments for years ahead, such cost fluctuations are a serious business challenge. Hence the pursuit of securing through valorisation clauses that allow you to transfer part of the price risk to buyers.
The purchase of an apartment, especially the first, is one of the most important financial decisions in life. Knowledge of your rights and a thorough analysis of the terms of the contract is the basis of a secure transaction. In case of any doubts regarding the provisions of the contract, consultation with a legal advisor may save many problems and unforeseen costs in the future.
The material was created in cooperation with The Morizon Gratka group.
