[BUYING AND SELLING REAL ESTATE IN CHILE]
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topographical survey, setting a unitary price per square meter sold, which may eventually result in an adjustment in the price. For example, if the topographical survey reveals that the property's actual surface is less than 2% of the property's surface in its titles, that difference is accepted by the Buyer. If the difference is higher, the Buyer will be entitled to request a proportional price reduction. Other commonly used conditions include: • For condominium properties, Buyer will have to submit to the relevant Co- ownership Regulation. • The property must be delivered empty, with no debts of any kind, i.e., land tax, utilities, common expenses, etc. • In the case of rural property, it must be delivered without workers of any kind. The Seller guarantees that the labor contracts of any workers of the property have been terminated. D. Titles: the sale is usually subject to the condition of having the Buyer's attorneys review the legal titles of the property. If the titles do not conform to the Law, said condition fails, and the Promise to Purchase turns void with no party liability. A review of the property's legal titles seeks to verify, at least, that: • The Seller, either directly or by adding the possession of the property by prior owners, has owned the property for at least ten consecutive years (being this term the statute of limitations for acquiring real estate). • The Seller (and prior owners), especially in the case of corporations, were legally entitled to acquire, maintain, and sell the property (i.e.,
corporations are mandated by Law to count with the authorization given by an extraordinary shareholders meeting, of the sale of real estate that represents 50% or more of the company's assets). • The property is not subject to encumbrances and limitations that may hinder its transfer or its full exploitation and use by the Buyer, due to, for example, leases, seizures, mortgages, prohibitions, mining permits, easements, expropriations, usufructs, environmental conservation rights, co- ownership regulation, etc. • Technical and environmental conditions that may affect the transfer or full exploitation and use of the property by the Buyer: For example, farming and forestry subsidies, debts owed to public institutions for land taxes, subsidies, declarations of public utility (which means part, or all of the property may be subject to future expropriation due to eminent domain), or the approval of the exploitation of the property by Environmental Impact Evaluation System (SEIA). ▪ In the case of urban real estate purchased for the construction of any building, both the city and the district's land-use master plans must be reviewed to verify if the construction in the property is authorized based on the use of land designated in the master plan. 5. Term and place of execution: the parties will often agree on a term to enter into the Purchase Agreement, usually based on the time necessary for the Buyer's counsel to review the property's legal titles and, when applicable, to obtain financing for the purchase. The parties will also agree on the
ILN Real Estate Group – Buying and Selling Real Estate Series
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