In the photo: singer Larisa Dolina (Photo: Elena Mayorova / Global Look Press)
The Russian Prosecutor General’s Office has supported the legislative initiative of the State Duma to ban real estate transactions for cash, RT reports. The bill was submitted to Parliament by Svetlana Razvorotneva, deputy chairman of the Committee on Construction and Housing from the United Russia faction.
It is important to note that approximately 10% of housing transactions are carried out in cash. Another decision of the State Duma contributed to this to some extent: that banks should not transfer large amounts to their customers immediately, but should give them out in installments over a long time. Therefore, a number of potential home buyers keep their money “under the pillow.”
About whether housing purchases will harm the institution in Russia has new rules for cashless payments only, realtor Elena Krasikova told the Free Press.
— Now, settlements on most real estate transactions, at least in large cities, are made by wire transfer through a letter of credit or a nominal account, the so-called Secure Settlement Service.
All money for real estate is accumulated in the bank’s account and transferred to the seller’s account only after the state registration of the transaction in the Federal Register. Moreover, the bank itself requests documents from Rosreestr checks them.
Cash payments through bank cells or with the entire amount of cash on the transaction at once, this has happened in my practice, are already a thing of the past.
“SP”: Will the ban on cash payments in real estate transactions reduce the number of remote actions of scammers, which begin with a call from an unknown phone number?
— I don’t think so. The seller can easily cash out the funds received for the sale of real estate, and through some couriers transfer them to fraudsters, as, for example, it was the case with the singer Dolina.
Banning cash payments will only make it more difficult to sell real estate with an incomplete value in the purchase agreement and will stand in the way of so-called non-monetary transactions in which, despite the receipt written by the seller, the actual transfer of money for real estate is not carried out.
“SP”: In a transaction that is paid in cash, does the buyer immediately become the owner?
— Any real estate transaction requires state registration of the transfer of ownership in the Federal Register. Extending the registration period if registrars have doubts about the integrity of the transaction, as suggested by the Duma to combat fraudsters, is a bad idea.
Until the summer of 2012, the deadline for registration of the transfer of ownership in accordance with the Federal Law of 07/21/1997 “On State Registration of rights to real estate and transactions with it” was 30 days, which was impossible for a long time.
Sellers and buyers suffered themselves, and tormented realtors. To reduce the registration period, many wrote in the purchase and sale agreements that the seller had the right to pledge, and then the registration was 5 working days, and the deposit was quickly withdrawn. Why go back to this again and increase the time frame?
SP: What can the government and state registrars do to reduce the risks of fraudulent schemes?
— State registrars may suspend a transaction if an incomplete package of documents or documents with errors is submitted, and/or the form of the transaction does not comply with the law, for example, a simple written one instead of a notarized one.
State registrars may refuse to register a transaction if there are court or other prohibitions, or the necessary documents cannot be provided or do not comply with the law. But state registrars do not have the opportunity to catch all the scammers by the hand, they do not conduct investigative activities.
“SP”: And how will the registrars resolve their doubts about the integrity of the transaction, that is, about the good faith of the parties to the transaction, if all the documents are in order?
— In my opinion, these issues are resolved only in the courts. Again, we recall the Valley case. She was recognized as unfit for work, being under the influence of deception or threats during the transaction.
Not every psychiatrist, even if they conduct an examination of the seller before the start of the transaction, will be able to understand that the person is in the thrall of deception.
Scammers are great at convincing victims that they can’t tell anyone nothing. Perhaps a lie detector test will help here, but such a practice cannot be implemented en masse when conducting transactions.
“SP”: We do not yet have a law that will regulate the activities of intermediaries in the real estate market. Is he needed?
— It is possible, of course, to adopt such a law and include the activities of intermediaries in the real estate market in the list of activities for which licenses are required.
Or oblige realtors to create their own professional self-regulatory organizations (SROs). All this will raise the price tag for real estate services, but it will not necessarily improve the quality. Some government-approved educational programs can improve quality.
“SP”: Can any businessman become a realtor?
“I don’t think so.” A realtor is a kind of synthetic profession. A realtor works with real estate, analytics, and documents, and he must be guided by the laws related to his type of activity.
But above all, a realtor works with people and their needs. He also works as a negotiator, often as a psychologist, and mostly as a “salesman.” And sales is the most difficult skill that can be acquired, and it is not taught in universities.
I believe that the mandatory requirement for realtors that the Duma wants to introduce is the absence of a criminal record for economic crimes.
I do not consider the mandatory requirement for realtors to have higher education to be justified. There are colleagues, excellent realtors, and with secondary specialized education.
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