Individuals, especially those looking for investment opportunities, often prefer properties that are still under construction. These properties, whether in the planning phase or already under construction but with completion spread over a defined period, tend to attract interest due to their more economical prices compared to ready-built ones. When choosing projects in this phase, it’s crucial to thoroughly research the construction company involved.
Firstly, investigate the projects previously completed by the construction firm, and if possible, visit these projects for on-site inspections. This allows for a close assessment of the construction quality and materials used by the company, providing insights into its approach to projects.
Moreover, in the Republic of Turkey, the registration records of all capital companies established in compliance with the law are publicly available. The Chamber of Commerce Trade Registry Gazette provides information on the establishment dates, fields of activity, registered capitals, partners and authorized representatives of these companies.
The registered capital of these companies signifies the amount for which company partners are personally liable against the company’s debts. Companies have legal personalities, and in the contractual relationship established between investors and construction companies, the liable party is the legal entity of the company. The registered capital determines the extent to which company partners are personally liable for the company’s debts.
For instance, if a company’s registered capital is $10,000, then the liability of company partners against third-party debts is limited to $10,000. To protect consumers, the Consumer Protection Law mandates certain safeguards against construction companies.
Accordingly, for projects involving the construction of more than 30 units, construction companies are obliged to obtain “Building Completion Insurance.” This insurance guarantees the completion of the construction as planned by the construction company, even in cases of failure to complete or bankruptcy. It’s widely known that reputable and serious construction companies often procure this insurance.
Additionally, the legislator has established a system called the “progress payment system.” According to this system, the proceeds obtained by selling the project planned by the construction company are collected in the company’s bank account, and a significant portion of these funds is blocked by the bank. This blockage is gradually released as the construction progresses, ensuring that the construction company cannot use these funds for any other purpose and preventing consumers from being disadvantaged.
