What to Check Before You Sign the Contract

Signing the purchase contract is the moment everything becomes official. Afterwards, backing out is hard and sometimes very expensive. So every check needs to happen before you sign. Here's the checklist I recommend every buyer go through with their lawyer.

1. Land registry extract: who really owns it

The land registry extract ("nesach tabu") shows who is registered as the owner and what is registered against the property. You can order it on the Israel Land Registry website. What to check:

• That the seller is the registered owner, and that all owners sign the contract.
• Registered mortgages: if there's a mortgage, make sure the contract arranges for it to be paid off from the money you pay.
• Caution notes: a note in someone else's favor may point to an earlier commitment by the seller.
• Attachments, liens and easements: any of these can delay the transfer of ownership.

Note that not every apartment is registered in the land registry. Many are registered with a housing company or the Israel Land Authority, and then you need a confirmation of rights from that body.

2. Building permits and the municipal building file

What you see isn't always what was approved. The building file at the municipality's engineering department shows permits and approved plans. Check:

• Whether an enclosed balcony, extra room or changed layout was built with a permit.
• Whether there are demolition orders or proceedings over unpermitted construction.
• Whether the area in the contract matches the approved area.

Unpermitted construction can affect your mortgage, your insurance and your ability to sell later.

3. Zoning plans in the area

A new building opposite your window, a road nearby, or building rights that add value, such as TAMA 38 or urban renewal. Check what's planned in the area on the government planning sites and at the municipality. It affects both quality of life and value.

4. Debts to the municipality and the building committee

In a proper deal the seller must present a municipal certificate showing no property-tax (arnona) debt; without it the apartment can't be registered in your name. Also ask:

• Whether there are debts to the building committee (vaad bayit) or management company.
• Whether a major renovation has been approved, such as an elevator, roof or facade, and who pays for it.
• Water, electricity and gas accounts: close them in the seller's name up to handover day.

5. Physical condition: home inspection

Before signing, hire a qualified engineer or inspector. Damp, cracks, plumbing, electrical or waterproofing problems aren't always visible. If there are findings, you can negotiate the price or require repairs before handover. With a new home from a developer, also review the technical specification in the contract.

6. Is your financing settled?

Before committing to payments, make sure you have a mortgage pre-approval and that the bank is willing to finance this specific property. The bank will require an appraisal, and sometimes the appraiser values the home below the agreed price, so the bank lends less than you planned. The contract should allow for that, and the payment schedule should match when the bank releases funds.

7. The contract itself

Your lawyer will review every clause, but it helps to know the main ones:

• A payment schedule that protects you, with money released in stages against progress in registration and handover.
• Handover date and agreed compensation for delays.
• What's included: kitchen, air conditioners, water heater, parking and storeroom, including their numbers.
• Registering a caution note in your favor right after signing. It protects your right to the apartment until it's registered in your name.
• Who pays what: purchase tax is on the buyer, capital gains (betterment) tax on the seller, and who handles registration.

8. Purchase tax: know it in advance

Don't arrive at signing without knowing how much purchase tax you'll pay. The difference between a sole home and an additional home can reach hundreds of thousands of shekels. Estimate it with the purchase-tax calculator on this site, and read more in the guide "How to calculate purchase tax".

In short

The list looks long, but with a good lawyer and the right order, most checks take a few days. Each one is cheap insurance against an expensive mistake. And if anything is unclear, ask before you sign, not after.

Want to talk it through? I'm Chaya Kraus of RE/MAX Together Ashdod. Message me on WhatsApp at 055-970-4745 and we'll go over it together, with no obligation.

This article is general information, not legal, tax or financial advice. Before any decision, consult a lawyer, tax adviser or mortgage adviser.