Buying an Apartment — Complete Guide: What to Check Before Signing?

Why is it Important to Inspect Before Buying an Apartment?

Buying an apartment is one of the most significant financial decisions in a person's life. It is a transaction involving substantial sums, numerous legal obligations, and consequences that can impact your financial situation for many years. Every year, thousands of buyers in Israel encounter problems that could have been prevented with thorough legal inspection before signing the purchase agreement.

A thorough inspection of an apartment before purchase is not optional — it is a legal and financial necessity. This inspection includes examination of the property deed status, building rights, liens on the property, legal status of the apartment, future urban planning and more. All of these directly affect the property's value, your ability to rent it out, sell it in the future, or use it as collateral for a mortgage.

Mandelbaum, Gor, Witzman-Gor and Partners, Law Firm, with over 18 years of experience in the real estate and property sector, assists buyers at every stage of the process. Our goal is to protect your rights and ensure that you sign a purchase agreement that is secure and clear.

Main Inspection Steps Before Buying an Apartment

The legal apartment purchase process requires a systematic inspection of several areas:

• Title Deed Inspection (Tabo Extract) — the foundation of every real estate transaction. This is the official legal document confirming who the lawful owner of the property is.
• Building Rights Inspection — Is the apartment built legally? Are there building permits? Are there building violations that could affect value or use?
• Liens on the Property — mortgages, attachments, third-party rights, accumulated maintenance fees or unpaid taxes.
• Capital Gains Tax and Purchase Tax — calculation of your financial obligations as a buyer.
• Purchase Agreement Inspection — clear provisions, division of responsibilities between seller and buyer, fair legal terms.
• Urban Planning — Are there renewal plans, public projects or changes in land use that could affect the property?

Tabu Check — First and Critical Step

The Tabu (Tabu Extract) is the official document issued by the National Land Registry. It contains the property details, legal owners, mortgages, liens, and any other rights on the property. A Tabu check is the first step that every buyer must take.

This check includes:

• Verification that the seller is indeed the legal owner of the property as registered in the Tabu.
• Checking whether there are mortgages on the property — and it is important to know when they will be removed (usually upon completion of the transaction).
• Checking for liens or government claims on the property.
• Third-party rights — for example, housing preservation rights, right of way, or rights affecting neighbors.
• Verification that the property conforms to the plan in which it is located (city plan, detailed plan, etc.).

A Tabu check is not a task that can be skipped. Mandelboim, Gor, Weitzman-Gor and Co. law office checks the Tabu for every buyer, and explains each detail in clear and easy-to-understand language.

Building Rights and Building Conditions

When buying an apartment, it is important to know that it is built legally and in accordance with the required building permits. This check includes:

• Building Permits — Are there valid permits for the construction of the building? Are they valid to date?
• Building Approval — Is there official building approval from the Planning and Building Authority?
• Building Violations — Does the apartment or building include building violations? These violations could affect the value, future sale, or even lead to a demolition order (though this is rare).
• Common Areas — Checking common building areas, shared balconies, and any space beyond the apartment itself.

In urban renewal plans (TAMA 38), this check is even more critical, as there are many stages of construction and analysis of building rights.

Liabilities on the Property — Mortgages, Taxes and Other Obligations

Before signing a purchase agreement, you must check whether there are any liabilities on the property that you will need to bear or arrange to have removed:

• Mortgages — Usually the seller is obligated to remove their mortgage before completing the transaction. This check ensures that the mortgage will be removed and that the property will be yours without liabilities.
• Accumulated Management Fees — Liabilities for unpaid management fees by the seller. These may become your responsibility as a buyer if not handled in the agreement.
• Unpaid Taxes — Property tax, municipal taxes, or other taxes that apply to the property.
• Liens — A court or government lien on the property due to some debt of the seller.
• Third-Party Rights — For example, housing rights of an ex-spouse, right of way of a neighbor, or other rights that give others some right to the property.

All of these must be clear in the purchase agreement, and typically the seller is responsible for removing them before completing the transaction.

Capital Gains Tax and Purchase Tax — Calculating Your Financial Obligations

When buying an apartment, there are two main financial obligations you need to be aware of:

Capital Gains Tax is a tax paid by the seller on the profit made from the sale (the difference between the original purchase price and the current sale price). This indirectly affects the price you pay, as the seller will consider this when determining the final price.

Purchase Tax (when buying a first or subsequent apartment) is the tax you pay as the buyer. The tax rate depends on the purchase price, your marital status, your age, and whether it is a first apartment or not. There are tax reliefs for young buyers, young couples, and in some cases for buyers in urban renewal programs.

Accurate calculation of these taxes is a vital part of your financial planning. Mandelbaum, Gor, Witzman-Gor & Co. calculates all your financial obligations for you, so there are no surprises at the end of the process.

Review of the Purchase Agreement — The Essential Legal Document

The purchase agreement (or sales contract) is the legal document that defines all the terms of the transaction between the seller and buyer. This is the document you will sign, so it is important that you are aware of every detail in it.

Review of the purchase agreement should include:

• Purchase price and payment terms — Is the price clear? Are there interim payments? When will you pay the final amount?
• Apartment handover date — When will you receive the keys and be able to enter the apartment?
• Condition of the apartment upon handover — Will the apartment be handed over empty? Are there any furniture or equipment remaining?
• Division of liabilities — Who is responsible for removing mortgages, paying management fees, and paying taxes?
• Property insurance — Who is responsible for insuring the property during the transaction?
• Conditions for canceling the transaction — What happens if one party wants to cancel? What are the consequences?
• Claims and liability clauses — What happens if problems are discovered in the apartment after you sign?

A good purchase agreement should be clear, fair to both parties, and must protect your rights as a buyer. Mandelbaum, Gor, Witzman-Gor & Co. reviews every clause in the agreement and explains to you exactly what you are signing.

Additional Checks in Urban Renewal Programs (TAMA 38)

If you are buying an apartment in an urban renewal project (TAMA 38), additional legal checks are essential:

• Review of the renewal plan — Has the plan been approved? What are the remaining steps?
• Building rights and new apartments — How many new apartments are in the project? How many building rights were allocated to the original owners?
• Agreement with the contractor — What are the contractor's obligations? What are his guarantees?
• Bank loan — In TAMA 38 programs, there is sometimes a bank loan for payment. Review of the loan terms is important.
• Floor rights and joint rights — Review of new shared areas and floor rights in the new project.

TAMA 38 programs are legally complex, and thorough review is essential.

Comparison Table — Essential Checks by Stage

Below is a table summarizing all essential checks that must be performed and at which stage of the process:

Every stage in this table is essential. Skipping any of them may lead to legal or financial problems in the future.

How Mandelbaum, Gor, Witzman-Gor & Co. Can Help You with Apartment Purchase

Mandelbaum, Gor, Witzman-Gor & Co., a law firm with over 18 years of experience in real estate and property law, offers comprehensive legal representation for apartment purchases. We assist buyers at every stage of the process:

• Initial property review — preliminary title search and basic building rights examination before you submit an offer.
• Purchase agreement analysis — thorough examination of every clause in the agreement, detailed explanation of your rights and obligations, and required amendments.
• Complete legal inspections — full title search, building rights, urban plans, financial liabilities, and taxes.
• Financial consultation — accurate calculation of purchase tax, appreciation tax, and all your financial obligations.
• Signing assistance — presence at the signing of the purchase agreement, ensuring all conditions are clear.
• Transaction closing management — registration with the Land Registry, removal of mortgages, ensuring the property transfers to you free of liabilities.

We understand that buying an apartment is an important decision. Therefore, we dedicate time and attention to each client, explaining every step in clear and easy-to-understand language. We do not use complicated legal terminology — we speak with you as a person.

First consultation meeting at no cost — If you are considering buying an apartment and want to understand the required legal inspections, we invite you to a complimentary initial consultation meeting. In this meeting, you can ask any question, understand the process, and receive specific recommendations for your case.

Summary — Why Legal Review is Essential in Apartment Purchase

Buying an apartment is one of the most important financial decisions in a person's life. A thorough legal review before signing the purchase agreement is not a luxury — it is a necessity. This review protects you from many legal and financial risks, and ensures that you are buying an apartment that is lawful, free of liabilities, and at a fair price.

The review process includes title search, building rights examination, financial liabilities check, purchase agreement analysis, tax calculation, and urban plan review. All of these are essential steps that cannot be skipped.

Mandelbaum, Gor, Witzman-Gor & Co. has deep experience in this field and is ready to assist you at every stage. We offer a complimentary initial consultation meeting, so you can understand the steps required for your apartment purchase.

If you are buying an apartment or considering a purchase, we are here to help. Contact us today and schedule your complimentary initial consultation meeting.