Contracts from developers hide a number of traps for consumers

Prague - Differences of up to one hundred thousand between the initial offer and the actual purchase price depending on the method of payment, vaguely determined or completely missing deadlines for final handover of the apartment, or missing penalties for breaching essential obligations by the development company. These are the most common violations discovered by the employees of the Consumer Defense Association at development companies. The developers' statements are being investigated by ČTK.
    The SOS also points out that consumers in some cases commit to signing certain contracts without knowing their content, i.e. the rights and obligations arising from them.
    Clients, if interested, also have to decide very quickly; with some developers, they may only familiarize themselves with the draft contracts and potentially negotiate their comments within short timeframes.
    The association also reminded today that for longer-term projects, an increase in the lower value-added tax rate from five to nine percent from January 2008 can raise prices. This is accounted for in the proposal for public finance reform approved by the Chamber of Deputies. The bill will still be assessed by the Senate and the President.
    People are said to often succumb to euphoria when selecting and purchasing an apartment, imagining how they will arrange their newly acquired apartment or property, while neglecting to pay proper attention to thoroughly reading the contract.
    "It is necessary for customers to always consult the contract with a lawyer, who can reveal potential risks, and to insist on the developer making adjustments to the relevant contractual provisions," advises Karel Pavlík from SOS.
    SOS employees conducted the survey as if they were actual interested parties in purchasing an apartment. They analyzed contracts and the offering methods of apartments at ten Prague development companies.