Most people want to resolve the issue related to the purchase of real estate. However, there is often not enough money to buy housing in new buildings, so the optimal solution is to choose an apartment on the secondary market. Here you can always find an apartment, the cost of which will be significantly less compared to a new house.
Secondary housing – what is it?
Represents real estate that has undergone the procedure of state registration of property.
This concept includes objects owned by private individuals or owned by municipalities. Important - no one has the right to sell municipal secondary housing, since this property is not legally the property of the people living in this living space. However, they are endowed with the right to privatize housing and after that, acting as an owner, they can realize it on the real estate market.
The only distinguishing feature of new buildings from secondary housing is the registered ownership and certificate of ownership, which has already been received directly by the owner.
The very name “secondary” means that the property was already owned, and, therefore, the subsequent transfer of rights will be the second in a row.
Characteristics of housing types
There are two main methods of acquiring real estate: by participating in shared construction or concluding a purchase and sale agreement with the owner. In the first case, the house in which the apartment is located has not yet been built and has not been put into operation. In other words, this type of property does not have an owner. Many people often confuse the offers of the primary and secondary markets, assuming that the primary market consists of new buildings, and the secondary market consists of comfortable older houses. The last statement is closer to the truth.
The primary market is an offer to participate in shared construction. Housing of this type exists only documented - in the estimate. An agreement is drawn up, on the basis of which, after completion of construction and all necessary communications, the developer transfers the rights to housing to the shareholder.
In cases where the house is built, but the apartments are not sold out completely, the owner of the land plot registers the title to himself. This is where it is appropriate to apply the concept of “secondary housing”. What does it mean? It's simple: the apartment has an owner. It has passed into someone else's possession and is now considered a secondary market item.
Which is better to choose?
The most common question from people who want to buy an apartment is what to choose – primary or secondary housing? There is a basic set of indicators according to which the choice is made; we will consider them in more detail below:
Price
It is a well-known fact that the price of 1 square meter in a house under construction directly depends on the stage of its construction. The early stage dictates a lower price, and then the price per square meter will increase as construction progresses.
The price of apartments on the secondary market in buildings of a similar segment, which are located within the same area as the new building, will always be higher in comparison with the primary one.
Time factor
Often, from the moment of signing documents on shared participation to the moment of actual provision of living space, it can take from 3 months - when living space is purchased immediately before the stage of commissioning of the object, to 1.5 years - if the contract is drawn up at the “zero cycle”. The secondary segment provides the opportunity to receive the keys to the living space immediately after the transaction is completed.
Financial expenses
The dominant part of the real estate of new buildings is transferred in the so-called “draft version,” that is, with concrete walls. As a result, the cost of repairing such housing will be significantly higher compared to “secondary” housing, even if it requires major repairs. But under the same conditions, the total amount of investment when purchasing living space in newly built houses will be much less.
freedom of choice
The most attractive, affordable and marketable real estate in projects under construction is subject to sale at the initial stages of development. As a result, this leads to the fact that by the time construction is completed, as a rule, impressive living spaces remain for purchase, more expensive or those that have certain disadvantages, for example, an unpresentable view from the window.
Choosing secondary housing provides greater freedom of choice among similar ones in a certain segment.
Potential Risks
When purchasing a secondary home, they are associated with the possibility of termination of the contract through the court. Or a situation is possible when the right to use the apartment arises for third parties after the fact of sale of the property. There is a possibility of encountering scammers who will carefully hide the most important facts concerning the object of the transaction, and after its completion will go to court to terminate it.
However, these risks can be prevented with a balanced and professional approach to assessing the history of the property. To do this, you should entrust the solution of such an important issue to qualified specialists who will scrupulously check the purity of the transaction. In reality, “a bird in the hand is better than a pie in the sky,” since the probability of not getting paid for real estate is much worse.
When purchasing housing in a new building, the risks are mostly associated with the work of the developer himself. Important - it is impossible to predict possible bankruptcy or delay in the commissioning of the facility. At the moment, the legislative framework in Russia is not able to fully protect buyers in the segment of new buildings.
Profitability Aspect
Fact - the price of one sq. meters in a new house increases in direct proportion to the construction of the facility. In case of rational investment of funds in primary housing, it is possible to receive up to 30% per annum. Real estate on the secondary market is increasing in price along with general trends in the industry. It can bring in real money if it is rented out, but the level of income cannot be calculated, since each housing requires an individual assessment.
Mortgage rates
Important - not all credit institutions provide lending for primary housing. Often, the developer accredits the property under construction with several commercial banks, which creates certain inconveniences for buyers.
"New flat"
The market for new buildings guarantees the legal purity of housing, provides the opportunity to carry out renovations in full accordance with the wishes of buyers, and also enjoy the knowledge that they are truly the first owners. Moreover, a newly built house is the key to new and serviceable communications and engineering systems, which can cause significant difficulties in “stale” houses.
Certificate of ownership
An undeniable advantage of purchasing real estate on the secondary real estate market is the opportunity to begin the registration procedure immediately after receiving a certificate of ownership. In accordance with current Russian legislation, if you move, registration should be issued no later than two weeks.
When purchasing housing in a new building, a similar certificate can be obtained no earlier than 3 months from the date of delivery of the residential building. There are situations when, in fact, the house has already been completely erected, the residents have moved into the apartments, but due to certain circumstances, the developer is not able to officially “hand over” the property. The result is that the house is not legally registered with the relevant government agencies, which leads to many related difficulties, including registration.
Secondary housing as an investment object
When deciding to purchase real estate on the secondary housing market, it is worth assessing the future and considering options for its subsequent implementation. If the goal is to generate income by increasing the cost of the apartment, then the object itself must be worthwhile - a good and prosperous area or the city center. It is important that the popularity and, accordingly, the cost of such an object will always be higher than the average level on the market.
If you want to buy real estate on the secondary market for subsequent rental to third parties, then it is best to consider options in residential areas or near large universities.
Primary: spacious rooms, but possible hidden defects
Kazakh new buildings today have plenty of both zealous supporters and no less zealous opponents. Due to the polar information on the Internet, it is quite difficult for an inexperienced person in such things to objectively assess the advantages and disadvantages of new housing. Of course, everything here depends on the construction technology, the developer, the location of the property, the adjacent infrastructure, etc. But in general, we can identify a number of general factors that are better to immediately take into account when buying a new apartment.
Thus, according to the vice-president of the UARK Nina Lukyanenko, among the advantages of new buildings the following can be identified:
- new engineering communications;
- basements without foreign, old odors;
- modern elevators (in most cases there are two of them - passenger and freight);
- spacious entrances and a beautiful entrance group;
- improved exterior finish;
- landscaped yard area, usually fenced;
- safe playgrounds;
- open layouts (high ceilings, large rooms, additional rooms, such as dressing rooms);
- the opportunity to make fresh renovations without wasting time getting rid of old wallpaper and floor coverings;
- the presence of underground parking and special parking areas for guests in class I–III buildings;
- attractive price against the backdrop of inflated demands from sellers of secondary housing (if we are not talking about luxury real estate);
- additional mechanisms for purchase - installment plans, mortgages on individual terms from partner banks at a reduced interest rate;
- minimum risks due to which the transaction may be invalidated.
Nina Lukyanenko
Vice President of the UARK
— As statistics based on our data show, in the last year and a half there has been a significant increase in transactions in the primary market. As for quality, if we are talking about the inexpensive segment, then, unfortunately, it is currently low.
However, this is not the only drawback of the new apartment. According to the honorary builder of the Republic of Kazakhstan, professor of the Kazakh Head Academy of Architecture and Construction Serik Nurshanov, typical disadvantages include:
- noise from ongoing renovations and construction workers living next door;
- construction waste on site;
- construction site next to the house and construction equipment in the yard (if the residential complex is still under construction);
- interruption of light and water supply due to ongoing work;
- sediment that the house produces over 2–5 years. If there were miscalculations in the project, this will immediately become noticeable: ceramic tiles in the bathroom may crack and fall off, the wallpaper will warp and crawl, etc.;
- often the appearance of hidden defects during construction (previously we talked in detail about their identification), requiring considerable funds to eliminate them;
- unfinished or poorly developed infrastructure near the residential complex;
- savings on building materials (sometimes the use of flammable, harmful elements).
Serik Nurshanov
Professor of the Kazakh Head Academy of Architecture and Civil Engineering
— SNiPs take into account the settlement of the building, which is why they provide for expansion joints. But even with this, problems will inevitably appear in the apartment if miscalculations were initially made in the project. I would also like to dwell on the materials used in the construction of modern buildings and, in particular, their safety. Let me give you an example from my personal practice: there was a case when, at new sites, developers insulated the ceiling part of the balcony with polystyrene foam, simply covering it with plaster. So they tried to save money. This is fundamentally contrary to safety rules! Let me explain: in a fire, the flame spreads under the ceiling, it is there that the temperature rises, and when the foam burns, it releases toxic gas. It's not hard to imagine the consequences.
The famous Kazakh architect Almas Ordabaev, who has designed more than 60 large projects in the Republic of Kazakhstan, including the Almaty residential area “Samal,” also shared his opinion with us.
Almas Ordabaev
architect
— Among modern construction companies there are both hacks and quite trustworthy developers. The problem is to distinguish one from the other. If you look at the projects of residential buildings built in the dashing 90s and early 2000s, everything looks decent. But how were they actually built? In conditions of lawlessness, theft, substitution, etc. No one knows whether these houses are reliable or not. The ones that have been built recently may well be better. But we can really talk about their quality only after a major earthquake.
Price analysis
To compare prices, let's take the real estate market of the Russian capital.
The Moscow primary market for the most part consists of modern business-level properties, which accounts for almost 40% of the total supply. Of this amount, almost half falls on the “elite” segment, which meets all modern requirements in matters of architecture and technical equipment.
Mid-level properties occupy about 29% of the market, and “economy” – about 5%.
The secondary real estate market mainly offers economy class housing - 39%, middle class - a little more than 31%, business class - almost 29%.
Most real estate experts agree that it is impossible to compare prices without taking into account the specific quality of the housing itself.
In general, we can now safely say that new houses are definitely more expensive than resale living space. The result is that the average price per square meter on the new home market is just over 206 thousand rubles, and on the secondary market – just over 180 thousand rubles.
For example, the sale of a 2-room apartment with a “stale” renovation of about 50 square meters in a standard block house in the center of the capital will bring from 11 to 12 million rubles. This amount is quite enough to purchase a comfortable and spacious 2-room apartment in the area of the 3rd transport ring. The area of a new apartment can vary around 80 square meters. In new buildings closer to the Moscow Ring Road, it is quite possible to buy a 3-room or a modest 4-room apartment. In the Tsaritsyno residential complex, you can buy a three-room apartment of 120 square meters for an amount of 11 to 12 million rubles.
What does secondary ad type mean?
There is an opinion that secondary real estate is an apartment in a panel house, of low quality, in general housing that is far from ideal. Yes, of course, there are such offers on the market, but currently more and more liquid objects are appearing that deserve the attention of buyers. New houses built no more than 5-10 years ago, comfortable, high-quality and cozy apartments - all this is high-quality secondary real estate available to many buyers today.
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