Before signing with a developer, check seven things: bank financing, a legal guarantee on every payment, what the price is linked to, late-delivery compensation, exactly what the spec includes, who the developer really is, and only then the price. A good price on a weak project is a bad deal.
Before one of our groups enters a project, it goes through due diligence. These are the core questions from that process, open to anyone buying from a developer, with us or without us.
1. Is there bank financing?
A bank-financed project means a bank examined the developer and the budget, and your money goes into a closed escrow account serving only this project. Without it, all of that checking falls on you.
2. What guarantee covers every shekel?
The Sale Law requires a guarantee for every payment: a bank guarantee or an insurance policy. Verify that each payment is released only against a guarantee, and that the payment schedule matches.
3. What is the price linked to?
Most developer contracts link the remaining payments to the construction-inputs index. In high-index years, linkage can eat a large part of any discount. Part of a group's power lives exactly here: capping or removing linkage.
4. What happens if delivery is late?
The law sets compensation for delays beyond the grace period. Check what the contract says, and check the developer's actual delivery history on previous projects.
5. What exactly does the spec include?
Kitchen, finishes, air conditioning, electrical points, parking, storage. Anything not written in the technical spec is a paid extra. Spec upgrades are one of the places where a group secures value that is hard to get alone.
6. Who is the developer, really?
How many projects has he delivered? At what average delay? What do handover inspections look like on his buildings? Look for the previous project, not the next brochure.
A good price on a weak project is a bad deal.
7. And only then: the price
A good price on a weak project is a bad deal. Once every answer above is solid, the price conversation begins. And there, the difference between approaching alone and approaching with a group behind you is measured in tens to hundreds of thousands of shekels.
The pre-signing checklist.
The seven checks we run on every project, on one page. Save it, print it, tick it off before you sign.
Open the checklistQuestions and answers.
What is the first thing to check before buying from a developer in Israel?
Bank financing. A financed project means a bank examined the developer and the budget, and your money goes into a closed escrow account. Without it, the whole burden of due diligence falls on you.
What guarantee must cover payments to a developer?
The Sale Law requires a bank guarantee or an insurance policy on every payment. No payment should be released without a guarantee against it.
Why does construction-index linkage matter?
In high-index years, linkage on remaining payments can eat a large part of any discount you won. A group can cap or remove linkage in negotiation.
When should the price be discussed?
Only at the end, after financing, guarantees, linkage, delivery, spec and the developer's track record all check out. A good price on a weak project is a bad deal.
Have a question about your own deal?
The first consultation is free with no commitment. We're happy to answer.
Book a free consultation