What You Should Know About Jerusalem Real Estate Legal Costs
Legal fees are an additional (hidden) cost of purchasing a property in Israel. A buyer is required to find a lawyer to guide him/her through the potentially complicated process of acquiring a property.
A lawyer’s expertise in Israeli real estate law is vital for the buyer, in order for him to determine:
- Who owns the title of the property;
- If there are any outstanding liens or charges on the property;
- If the seller has issued a declaration on the property.
In addition, a buyer may have to sign a Zichron Devarim, a one-page document that outlines the essential terms of the agreement. The buyer’s lawyer will have to write it and he/she will charge for their time, incorporating it into the legal fees.
In general, Lawyers do not advise the buyer to enter into a Zichron Devarim because it comes with legal obligations. Yet, it also means that the buyer formally reserves the property for himself/herself and ensures that other, prospective buyers can no longer purchase the property.
How Much Do Lawyers In Israel Charge?
Often, though, and particularly in more affluent neighborhoods, the buyer will have to pay more than 10,000 NIS. However, this may not be the only legal fees that the buyer has to pay.
Buying Property From a Contractor (Kablan)
If a buyer purchases a property from a kablan (a developer), the buyer will be charged for the legal fees of the kablan’s lawyer, even though he/she neither represents the buyer nor looks after his/her interests.
The kablan’s lawyer charges between 1.5% to 2% of the purchase price, plus VAT. This is to cover the cost of registering the property in the buyer’s name.