Comparative legal characteristics of the conditions for the financing of housing construction

Abstract

The article presents a comparative legal analysis of the laws of Ukraine, France and Germany regarding the regulation of housingconstruction conditions.According to French law, the buyer of real estate under construction can be any individual aged at least 18 years and with fullcapacity.There are no special requirements for real estate developers under construction. However, such developers must meet the generalrequirements for property developers. For example, they must obtain a construction permit or a preliminary declaration, if necessary,for a new construction project. The building permit is issued by either the mayor or the prefect. The building permit is valid for threeyears, during which the developer must begin construction. However, the relevant authorities may extend the period (period of time)for the start of such construction. After the start of construction work can not be suspended for more than a yearLegislation stipulates that the buyer can purchase real estate, which is under construction, only under contractual mechanisms.In particular, the purchase of unfinished construction projects usually includes two stages:– the first stage – the conclusion of a preliminary (reserve) agreement between the buyer and the developer (“Preliminary contract”);–the second stage – the conclusion of the final contract of sale (“VEFA Agreement”) between the buyer and the developer.The French legislation describes in detail the procedure and amount of financing the construction of housing by investors (buyers).German law regulates housing construction in a slightly different way, however, as in French law, there is also a provision on thegradual financing of housing construction.In Ukrainian legislation today there is no provision for the need for gradual financing of housing by investors (buyers). This situationin practice often harms the rights of investors.The use of escrow accounts in the construction of investors can improve the situation of investors in Ukraine, which in fact, byanalogy with the legislation of France and Germany, will allow the gradual financing of housing construction.