How to transfer apartments to housing stock in 2023: is it possible to transfer them to residential status, practice

What most often prevents a change in the status of real estate - the willfulness of officials or the technical parameters of the apartments? Many owners are faced with the question of whether it is possible to register apartments as residential real estate, and if so, how to do this.

The editors of the portal Novostroev.ru have made an attempt to understand why this may be necessary for residents of housing with a “doubtful” status and invites readers to familiarize themselves with the conditions for carrying out this procedure.

On the Russian market, developers offer potential buyers not only apartments that have the status of residential real estate, but also apartments - housing that does not have such status. Despite the status of non-residential real estate, apartments are popular because they have some advantages over apartments.

Content

Apartments, despite their status, continue to be popular, and some buyers specifically choose this particular housing format.

Mainly because apartments are cheaper than apartments (other things being equal) .

The cost reduction can reach 20% and is explained by the fact that such housing is not subject to general legislative rules that relate to housing parameters, as well as the organization of the local area.

Such residential complexes have many useful services - you don’t have to go far for household services. Often such houses offer cleaning, grocery delivery, and a laundry service; in addition, such projects, as a rule, are built in convenient areas with high-quality and established social infrastructure.

Disadvantages of the status of “non-residential real estate”

But in a number of cases, shareholders have no idea that their housing will have the status of “non-residential”.

When selling, the developer publishes completely correct information - housing is actually for sale, that is, you can live in the premises, and they were originally intended for this.

However, there is no mention of status in advertising materials, and some buyers, not familiar with the intricacies of housing legislation, simply have no idea what awaits them. Namely:

• Utility tariffs are higher than in residential real estate (tariffs for commercial premises apply) , that is, the owner will have to pay more. Current overpayments on utility bills over time offset the savings that resulted from lower housing costs;
• It is not possible to register for housing on a permanent basis ; it is possible to obtain temporary registration, however, the maximum validity period is 5 years, then you have to register everything again. Lack of registration complicates the ability to place a child in a kindergarten, school, register with a clinic, etc.;
• Property taxes are calculated at the maximum rates used for residential taxes. If the rate for an apartment is 0.1%, then apartments are taxed at a rate of 0.5% to 2%;
• The buyer cannot count on a tax deduction , as is the case with ordinary apartments.
• When constructing apartments, developers are not required to build social infrastructure facilities. This means that, with a high probability, residents will have to put up with their absence.

Actually, apartments are an excellent option for those who intend to use housing of this format directly for its intended purpose, for periodic living. In this case, the owner is unlikely to be concerned about the impossibility of registration, and will not become poor when paying utility bills, since many items are calculated based on meter readings.

Possibility of changing the status of real estate during construction

In some cases, the developer provides savings (which is also reflected in the price of housing) at the stage of obtaining permits, the registration of which for the construction of apartments is cheaper than for real estate with the “residential” status. During the construction of the building, the developer initiates a procedure for changing the status, and the shareholder receives a full-fledged apartment at a price that is slightly lower than the market average.

Of course, all this is discussed with the shareholders, but it is worth paying attention to the fact that in order for real estate to be transferred to “residential” status, it must initially be built in accordance with established standards.

It is very difficult to hold the developer accountable, since it is apartments that appear in the DDU.

Conditions for changing housing status

Changing the status of apartments is possible only if the following conditions are met: the housing is owned, does not have any encumbrances and fully complies with the requirements of the law for real estate intended for permanent residence. We are talking about the area and configuration of residential and household premises (compliance with the minimum footage of rooms, etc.) , natural lighting standards (for example, there must be a window in the living room) , sound insulation, sanitary and fire safety rules.

In addition, there must be elements of social infrastructure nearby, and in the local area there must be children's playgrounds, parking, and recreation areas - in the case of apartments, the developer is not obligated to provide all of this.

Actually, apartments are cheaper than regular apartments for the reason that the requirements for “temporary” housing are lower than for residential real estate. Which, accordingly, gives the developer some room for maneuver, allowing him to reduce the cost of construction, and thereby improve his position in the highly competitive construction market.

Thus, it often turns out that the apartments do not meet the required status in many respects, in which case nothing can be done to change it.

Assessing the situation: is it possible to change the status?

What needs to be done to change the status of a property to “residential”? In the case of apartments, there are not many options:

• The apartment may already comply with all the required rules, in which case all that remains is to collect the necessary documents, submit an application to the appropriate authority and pay the fee. A commission of specialized specialists will conduct an inspection, and if officials have no objections, the status of the housing will be changed. However, even in this situation, not everything is so simple; the legislation describing the parameters of residential real estate is quite vague, which gives officials the opportunity to make decisions almost at their own discretion.

Naturally, the refusal to change the status is formalized accordingly; for example, the commission may consider that the location of the doorway cannot ensure safe movement around the apartment.

However, the officials’ refusal can be appealed in court, and if their decision turns out to be unlawful, an independent examination will be carried out, on the basis of which the court will most likely rule in favor of the owner.

However, before initiating legal proceedings, it is worth remembering that all costs are borne by the owner.

• The apartments do not meet the requirements . In this case, it is necessary to bring the housing into compliance with all standards by performing redevelopment (changing the configuration of premises, possibly engineering infrastructure) . However, it is necessary to understand that in some cases this cannot be done, given the technical characteristics of the building, the planned changes may turn out to be unsafe for the structure of the house.

Accordingly, the city authorities will not approve such a project and will not issue permission for redevelopment, and if the work is carried out without permission and contradicts safety standards, the changes cannot be registered. Moreover, the owner will be required to pay a fine and “return everything as it was,” unless, of course, independent work carried out without permission does not lead to more serious consequences.

These include the collapse of part of a building due to a violation of the integrity of structural elements (for example, when trying to drill a window opening in a load-bearing external wall).

The modern practice of transferring real estate to residential status suggests that this procedure is usually applied to the entire building; for this purpose, a meeting of residents is convened, an examination is carried out and the relevant documents are prepared.

Cases of changing the status of one apartment are quite rare, since if the housing complies with the standards, then this applies to all other apartments; this rule also applies in the opposite direction.

Although the law does not indicate that it is impossible to change the status of just one apartment.

Where to start: the legal side of the issue

The first step is to put the legal side of the issue in order. Namely:

• Obtain ownership of housing if we are talking about an apartment in a new building and this has not yet been done. To do this, the new building must be put into operation (this is done by the developer) , and the apartment must be transferred to the shareholder according to the acceptance certificate. All that needs to be done in this case is to submit an application to Rosreestr along with some documents (copy of the DDU, passport, acceptance certificate) and pay a fee (about 300 rubles) . You can take the package in person or send it through the MFC.

Actually, developers also offer the service of registering property rights, but they ask for an amount of 30 thousand rubles for its provision (for mysterious reasons, never established by the Novostroev.ru portal, this is much higher than the official fee of 300 rubles) . This is much more expensive than registering it yourself, so we cannot recommend this method of obtaining title.

• Remove encumbrances. One of these is the mortgage debt to the bank, which must be repaid.

If the housing parameters correspond to the new status

You need to go to the body that deals with issues of changing status (in the capital this is the City Property Department) with an application and a set of documents.

The set includes an extract from the Unified State Register of Real Estate (confirming ownership) , a copy of the passport, and a technical passport of the apartment from the BTI (confirming compliance with the requirements) .

The latter document may not be provided; in this case, department employees will send the request themselves, but because of this, it may take more time to consider the application. Yes - you still have to pay a fee, the amount is about 20 thousand rubles.

After inspection of the housing by employees of the commission sent by the Department, a decision will be made to change the status of housing or refusal with a clear justification of the reasons. If the reasons include such inconsistencies that can be eliminated by redevelopment, it is worth doing just that (the procedure is described below) .

If housing parameters can be “adjusted” to the new status

Now consider the following option: the apartments do not meet legal requirements, and redevelopment is required to change the status.

To begin with, of course, you should clarify whether it is possible to carry out changes from a technical point of view, whether the authorities will issue permission for redevelopment, and whether the apartment, after completion of the work, will comply with all the required standards.

To find out, you need to contact a public or private design organization.

If it turns out that redevelopment may well be carried out, you should prepare a draft of the proposed changes, and then go to the Department and apply for a permit. To the application you need to add a redevelopment project, a technical passport for the apartment (with a floor plan) , these documents are drawn up in the BTI, DDU (or other title document) , as well as a passport.

After the commission inspects the property, the owner receives official permission and can begin work. If there is a refusal, it can be appealed in court. Upon completion of the work, you need to put the apartment into operation by contacting the same authority where the permit was issued.

When the redevelopment is legalized, you can submit an application to change the status of the property (to the same Department) . However, first you need to produce a new technical passport for the apartment (ordered from the BTI) , which must be attached to the application along with the passport and title document.

Registration of changes in Rosreestr

The final stage is registration of all changes in Rosreestr; simultaneously with registration, a decision on the new status of housing, which is made by the Department, is also drawn up. You can submit an application to Rosreestr in person or send it through the MFC.

Specialists will make the necessary changes to existing records, after which the apartments will officially receive the status of residential real estate.

There is no additional need to formalize ownership rights; this procedure is performed automatically; the corresponding document is issued to the owner upon completion of all actions within the framework of registration of the new status.

Conclusion

By acting in accordance with the recommendations given in this article, and subject to the appropriate conditions, you can transfer the apartments to the status of residential real estate.

Read also:  How is inheritance divided during divorce?

However, it is worth understanding that often owners are faced not only with the impossibility of doing this purely due to technical parameters, but also with the reluctance of officials to change the status of their housing.

This is due not least to the responsibility for safe living in the converted living space, which they have to accept not themselves, as well as to some “blurring” of the legislation.

Thus, if there is a need to change the status of housing, the owner will need expert advice, both from the technical side of the issue and from the legal side. We, for our part, hope that the information provided here will help you achieve success in all procedures.

From apartments to housing – difficulties in translation | Smart Real Estate

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07/29/2016 Print version

Analysts from Match Point and NDV-Real Estate found that 29% of apartment buyers purchase them with the expectation that the completed property will be converted into housing stock. Smart Real Estate asked market experts how realistic such expectations are.

Disputed status

From a legal point of view, apartments are non-residential premises with the right of residence.

In addition, the difference between apartments and apartments is that they do not provide the right of permanent registration (only temporary registration is possible), moreover, the property tax rate is higher here, and the payment for utilities is higher. At the same time, the cadastral value of apartments is lower than that of apartments with similar characteristics.

– The apartments appeared on the market not so long ago, but quickly gained popularity and are selling well.

However, I agree that almost a third of buyers purchase apartments, expecting that over time they will be converted into residential real estate status (or they will be able to do this themselves).

The legislation regarding apartments is still being formed and is undergoing constant changes, this applies to taxes and cadastral value.

– Recently, a bill was introduced to the State Duma proposing to equate apartments to the housing stock.

I think that it is impossible to convert all apartments into housing status, since the requirements for residential premises, for example, in terms of insolation, provision of social facilities, landscaping, and sanitary standards, are much stricter. But some, just 20–30%, have a great chance of receiving such status, the expert believes.

Vice President of NAI Becar (St. Petersburg) Ilya Andreev is sure that apartments are rather a marketing term. According to him, there are currently several formal definitions of apartments, and none of them include information about what type of real estate such objects belong to.

– It is important to understand that real estate in Russia is subject to certain requirements. Firstly, urban planning, that is, the ability to locate a residential building in a particular zone in accordance with the rules of land use and development. Secondly, the compliance of a particular object with the parameters of a residential premises in accordance with sanitary and fire standards and requirements, explains the expert.

Conditions and regulations

Under what conditions is it possible to transfer apartments to residential premises? According to Maria Litinetskaya, this is possible if the project is accompanied by a set of infrastructure (including social), or if the developer is ready to build additional infrastructure facilities.

– To convert apartments into housing, it is necessary that they meet the legal requirements for residential premises. Standards for insolation, minimum footage of rooms, width of openings in load-bearing walls, requirements for engineering systems and fire safety must be observed.

Converting apartments into housing is common and potentially feasible in mixed-use complexes that have both apartments and apartments. Such projects, as a rule, take into account the requirements for the availability of infrastructure, so this format of real estate is more consistent with housing standards, says the expert.

The head of the analytical department of Mobile Stroy XXI (Moscow) Vyacheslav Sultanbaev agrees with his colleague:

– This transfer depends on how well the apartments comply with housing standards. If the mentioned standards are violated, then the transfer of apartments to housing stock will be extremely difficult, if not impossible. First of all, this concerns the so-called “lofts” - apartments obtained through the reconstruction of office buildings and industrial premises.

If the main reason for the status of apartments is the developer’s failure to assume social obligations (construction of kindergartens, schools, hospitals), and otherwise the house with apartments is no different from an ordinary residential building, the transfer of such an object over time to the housing stock is quite possible. Moreover, some developers, after commissioning the projects, transfer the apartments into housing stock, thereby confirming the reality of such expectations.

General Director of SMU-6 Invest (Moscow) Alexey Perlin also emphasizes that “difficulties with translation” may arise where there is no infrastructure or it is insufficient.

– Residents of megacities should be provided with kindergartens, schools, clinics, and shops. If there are not enough social facilities around, then they should be in the complex itself.

In addition, a change in status also implies a change in the purpose of the land plot for residential construction.

If these two points are observed, as well as the current norms and rules on insolation, transferring the status of apartments to housing is quite possible, the expert is sure.

Successful examples

Despite all of the above, as well as a wide discussion of the fate of apartments at the legislative level, neither developers nor buyers of such real estate still have clear criteria by which to understand the likelihood of its conversion into housing. “Today, a decision is made on an individual basis for each project,” notes Maria Litinetskaya.

If we talk about specific cases of translation, Alexey Perlin named the arch-project “Faces” and the multifunctional complex “Vodny”. Maria Litinetskaya cited as an example part of the Fili Grad lots and the Monet Residence. In addition, the developer of the Start-Format apartment complex in the Tsaritsyno-2 microdistrict announced the planned transfer of apartments to housing.

– It is now a fairly common practice for large developers to transfer apartments to the status of residential real estate during the construction stage. The procedure is quite complicated, but quite feasible. The main issue is changing the type of permitted use of the land,” comments Oksana Matorina.

Ilya Andreev also mentions several examples of changes in the status of apartments. According to him, in Moscow apartments were transferred to housing stock at the direction of the mayor.

Therefore, according to the expert, there are no widespread prerequisites for converting these objects into residential ones.

We wrote earlier that amendments to the legislation that would allow permanent registration in apartments could be adopted before the end of this year.

Smart Real Estate

According to the portal. When using the material, a hyperlink to Razned.ru is required.

How to convert apartments into housing stock (apartment)

How to convert apartments into housing stock is a question that has worried a growing number of Russians in recent years.

The popularity of apartments is growing rapidly, which is not surprising: the houses are located in comfortable locations in the center of the metropolis, and their price is 10-15% lower than a similar apartment in the same area.

But you cannot register in an apartment, since this requires the status of the premises to be residential - and this type of housing does not qualify as such. Professionals will tell you what to do and how to change the status of the apartment.

Reasons and necessity

The apartments are intended primarily for wealthy people accustomed to luxury. Taking this into account, the conditions in the apartments cannot be called non-residential, even giving free rein to fantasy and imagination. But due to some flaws in the law, they receive the classification of hotels or office buildings.

Because of this formality, it is impossible to register in the apartment - after all, in essence, like traditional apartments, de jure they are not an apartment. It would seem, why organize this fuss if there is no ban on living without registration? But restrictions will come in other areas:

- apply for a job;

— send children to school/kindergarten;

— be served at a district clinic, etc.

This is where the need to convert apartments into apartments arises.

News from the Duma

For a long time, the apartments were used by wealthy people - not in the format of living quarters, but as an additional home for meetings and negotiations outside the family hearth.

Apartments and residences often acted as apartments in other cities, so the requirements for permanent residence were of little concern to the owners.

And even when people began to live in the apartments on a permanent basis, registration did not mean anything to their owners, since they did not apply for either employment or government services.

Everything changed after apartments fell in price compared to residential apartments. Representatives of the middle class began to purchase them, for whom social security and infrastructure played an important role. So, after a couple of years, it became necessary to register at the residential address, and the only option for this is to transfer the apartments to housing stock.

Match Point research has shown that a third of apartment buyers expect the premises to be converted into residential housing upon completion of construction. This is not least due to the surge in apartment sales over the past few years. The excitement is partly fueled by rumors about a bill that will introduce the concept of apartments into use and equate them to the residential real estate stock.

But, although some government officials stated back in 2015 that the changes would come into force within a year (in 2016), the project has not yet even been officially registered for consideration. Therefore, many homeowners, having lost patience, decide to convert the apartments into a residential format individually. And they face a whole bunch of difficulties...

Insolation is a stumbling block

The main translation problem is the level of insolation. According to the standards established by SanPiN 2.2.1/2.1.1.1076-01, only a room that is illuminated by direct sunlight for at least two hours a day can be considered residential. In this context, it is sometimes simply impossible to transfer apartments due to the high density of surrounding buildings.

If the windows of a building are blocked from the Sun by the shadows of skyscrapers, the apartment will not be bright. Let her be at home only late at night - the law is unshakable. Insolation rates depend on latitude. For example, Moscow is located on the northern borders of the central zone, for which the standard is 2 hours/day. In high-density buildings, the sun often does not reach the windows for even this minute.

You can't convert an apartment to an apartment if the sun doesn't get in, but there are "loopholes" to bypass the system. So, it doesn’t matter how the apartments are filled with light, and at what time of day this happens. Thus, the housing stock allows for fragmentation of the standard - that is, lighting can be interrupted and consist, in fact, of several “approaches”.

Fractional insolation should be 30 minutes longer, while at least one of the lighting periods should last continuously for at least an hour, but this is enough to significantly expand the capabilities of residents.

Loopholes in lighting laws

Not all rooms in the apartment need to be illuminated. For a two-room apartment, one insulated room is enough, for a multi-room apartment, two. Here you can cheat and convert a spacious apartment by dividing the sunny room into two small ones.

Please keep in mind that in accordance with SP 54.13330.2011, the width of a single illuminated room must be at least 2.5 m, and the total area must be at least 9 “squares”.

Therefore, not all apartments can be converted into residential status purely physically.

It is also formally possible to divide the entire apartment in two, with one being illuminated according to all standards, the second - as before. The first can be easily converted into a living space format - where, accordingly, you can register.

But red tape awaits here: it doesn’t matter whether it’s residential or non-residential, the premises must be equipped with its own kitchen and bathroom.

Therefore, if it is not possible to separate the riser outlet or gas main according to plan, there is the last, most radical option: demolish all the internal walls, transferring the apartment to studio status.

Otherwise, the building rules are a “dark forest”, and the “paths” in it are constantly overgrown - just as new ones appear. Therefore, only a specialized specialist can clearly answer what possibilities are currently open regarding giving the premises residential status.

A little about ventilation

Often the ventilation system does not allow the premises to be converted into housing. Since the lion's share of the apartments is a reconstruction of what was once truly non-residential premises, the ventilation system is preserved, as is the water supply and sewer system, common to the entire building.

At the same time, SNIP 2.04.05-91 allows for the combination of residential premises and industrial premises with a single ventilation system, only if the latter are not a place of mass gathering of people. The conditions for commercial premises in the city center are practically impossible to fulfill, and therefore it will not be possible to convert apartments into apartments without fundamental changes.

In addition, the total area of ​​the combined premises cannot exceed 200 sq.m.

At the same time, in most high-rise buildings, which have the status of not residential but industrial premises, forced ventilation is designed for thousands of “squares”.

Therefore, in some cases it will be necessary to convert the ventilation of apartments into an individual residential format. It is important that the disconnection from the general building system does not affect other elements of the air exchange chain.

General transfer procedure

To re-register an apartment, you will need to establish the technical feasibility of this very transfer. If internal repairs or ventilation systems are a solvable issue, at least theoretically, then skyscrapers blocking the sun will not be able to be moved.

If there is a chance to change the status of the premises, you will have to prepare a lot of documents:

1. conclusion of authorized organizations on the technical feasibility of changing the status of non-residential premises;

2. official request for re-registration;

3. redevelopment project;

4. technical plan for converting apartments into apartments and much more.

After the work has been completed, you must also have it certified by the acceptance committee and receive an extract from the Unified State Register of Real Estate on the assignment of the status of residential premises.

A complete list of documents for replenishing the housing stock, not to mention strictly regulated procedures, will seem like a nightmare to those inexperienced in matters of real estate jurisprudence. Indeed, a person without relevant experience will not be able to understand them, which is why many mistakes can be made and apartments will be difficult to transfer.

Therefore, you should entrust the maintenance of documentation for residential premises to professionals. Fortunately, today many companies provide consulting and legal services for changing the status of residential/non-residential property.

Of course, outside the framework of building codes, even the highest representatives of the government are powerless, and the apartments need to be transferred to the status of officially residential premises; lack of technical conditions, any decree will be powerless.

But if you have access to the mayor’s office, you can significantly save time by contacting those who make the final decision in the decision to transfer the apartments to housing stock directly.

“Developers prefer to remain silent about the details and schemes for converting apartments into apartments”

Olga Tarakanova, partner, general director of ORDO Group, told the Novostroy-M.ru portal about how buyers can independently convert apartments into apartments, in which cases this should not be done, and which apartments will be developed during the crisis.  

Today, mixed projects are increasingly appearing on the market, where some of the buildings are classic apartments, and some are apartments. Accordingly, people are wondering whether they should buy an apartment that is cheaper and convert it into housing (thus saving money). Is the game worth the candle?

In the luxury segment, buyers usually look only at the price and, more recently, the absolute amount of tax on real estate ownership. The difference in the cost of operating services is no longer of much concern, since the situation here is similar to ordinary residential buildings.

In the “comfort” and “economy” segments, the buyer should think carefully.

If the premium in price that it has (usually 20-30%) at the time of purchase justifies its further expenses for obtaining the services of the necessary infrastructure at the place of residence (kindergartens, schools, medical care) and there is no need to obtain permanent registration, then the apartment is quite possible buy.

To the price benefit you can add the tax benefit. After all, the cadastral value of non-residential premises is much less than that of residential premises. The transfer of apartments to housing in this case is not justified, because in some cases, the cost of this event may cover the difference in the purchase price.  

What standards must a transfer apartment meet? Can any apartment be converted into an apartment?

The main criterion for transferring to residential status is a two-hour daily interval during which sunlight must enter the living rooms of the premises.

Accordingly, apartments with insufficient insolation, for example, with windows into a “well” or into the atrium of a house, today have no chance of becoming residential. In the future, the norms may change, but for now this is the case.

In accordance with Russian legislation, a mandatory condition for transferring any premises to a new status is the absence of encumbrances imposed by other persons.

Let's say the owner of the apartment is convinced that the norms allow him to become the owner of a classic apartment. Please tell us what the buyer should do to make the transfer?

If the transfer is carried out simultaneously with redevelopment, it is necessary to attach a project for redevelopment and reconstruction of the premises. In addition to the list established by law, the owner must provide about twenty more documents from various services and government agencies.

Here we must immediately make a reservation - in practice, I have not encountered cases of individual transfer of apartments to apartment status. I assume that it will take more than one month to knock on the thresholds of all relevant authorities. At the same time, no one will give you a guarantee of the success of this event.

The practice of mass appeal of owners to the developer is more justified - there were such precedents in the market, at one time the status was changed by projects of the companies KR Properties, Vesper and Capital Group. But developers prefer to remain silent about the details and transfer schemes. A number of developers are deciding on the issue of converting apartments into housing even before putting the house into operation.

Thus, they raise interest in the property from potential demand, which inevitably leads to an increase in the price and speed of sale of the property. Here everything depends only on the buyer - there is an opportunity to pay more for a lot with the condition that the process of changing its status falls on the shoulders of the developer, which means this is your option.

Is it possible to transfer an apartment during the construction of the building or only after its commissioning?

You can also translate during the construction period. An example of this is such objects as “Barkley Plaza”, “Barkley Park”, “MONE Residence” and some others.

How do you generally look at the development of classic apartments and apartments in times of crisis? Are these formats competitors?

In times of crisis, all forms are good that allow business, in particular the construction industry, not to stand still.

Adaptation to new conditions, both in terms of quality, planning solutions for objects, and a new approach to creating a balance of areas, all together and separately, adds developers a chance for successful implementation of the project.

Professionalism, the ability to sense current trends, predict the development of the future situation in the real estate market and, as a result, the competitive position of the developer provide the key to success in any project. If the developer cannot or is unable to foresee his own sales situation on the horizon for at least 2-3 years, we always recommend seeking advice from independent market experts.  

Is there a threat that the apartment will be deprived of its residential status? For example, if the rules are tightened in the future.

As usual, in our country and in our city, especially no one gives anyone any guarantees. A recent eloquent example is the night of the long ladles.

What do you think about the emergence of mixed “apartment + apartment” projects in the future? Will such LCDs become a trend or not?

Mixed projects arise as a given if part of a building or complex can be converted into residential status, but part cannot due to non-compliance with standards. That is, such complexes cannot be called any separate concept.

In a crisis, which apartments will be developed more - expensive or economy class?

In the “economy” segment, apartments are also built not for ideological reasons, but based on savings. The cost of entry into non-residential projects is 30-40% cheaper. Therefore, the issue of transfer does not arise at the stage of acquiring a construction site. But it may arise later in order to intensify sales and increase the price per square meter during the construction process.

In a crisis, many projects will rather slow down rather than develop. To be honest, only competent projects with the right quality concept that meets today's market needs and competitive prices will be developed and sold.  

Publication date April 12, 2016

Will it be possible to convert the apartments into housing?

Construction companies go to different lengths to make their properties attractive. Many buyers are already aware of the advantages and disadvantages of apartments associated with their non-residential status. To make up for these shortcomings, developers sometimes promise the future owner the transfer of apartments to residential premises. Let's see if this is really possible.

Is it possible to convert apartments into housing stock?

Theory

Apartments are equivalent to hotels - non-residential premises for temporary residence. The legislation does not prohibit the conversion of non-residential premises to residential ones. The main condition for converting apartments into residential premises will be the compliance of the building as a whole and the specific premises in it:

• sanitary and epidemiological standards; And
• technical standards adopted for residential premises.

The most common obstacle to transfer is non-compliance with insolation standards (exposing a room to sunlight for certain periods of time). The following may also be a problem:

• building location,
• lack of entrances and parking lots, other infrastructure,
• type of permitted use (purpose) of the land plot on which the apart-hotel is built;
• its immediate environment - for example, housing cannot be located near most industries due to the sanitary protection zones established for them.

Practice

Most apart-hotels are initially built as non-residential buildings. Therefore, the standards applicable to housing are not observed for them - in order to reduce the cost of the project, or simply because it is impossible to comply with them in this place. Therefore, in practice, promises of transfer may not be fulfilled.

It will be difficult for the buyer to assess in advance whether a particular apartment can actually receive the status of an apartment. To do this, you need to have special technical knowledge or hire a specialist to analyze the situation.

In most cases, transferring to housing will be an impossible task. But you can take a risk by relying on the words of the developer (however, you should not hope too much for the success of the enterprise).

The procedure for transferring to a non-residential fund

Existing legal regulations mainly apply to the transfer of premises in apartment buildings. However, this procedure can also be carried out in an initially non-residential building. Some developers are trying to organize it centrally for the entire building at once. Others give buyers the opportunity to handle this issue themselves.

To convert to an apartment you will need:

• application from the owner and documents confirming his rights (extract from the Unified State Register of Real Estate);
• consent of neighbors to the transfer;
• technical documentation (cadastral and technical passports and floor plans).

The documents are submitted to local authorities, which must decide on the possibility of transfer in principle. They can be submitted through the MFC or the government services portal.

To carry out a change of status to residential premises, an examination will be required to determine whether it can really take place.

If the answer is positive, you will need to:

• develop and coordinate project documentation for the transfer of apartments to residential premises;
• obtain permission to carry out construction work and carry it out (if necessary);
• enter information about the new status of the premises into the technical (cadastral) documentation and into the Unified State Register data.

Apartments will not yet be centrally equated with housing

In June 2018, a bill was introduced to the State Duma designed to solve the problem of apartments radically and immediately for everyone. In accordance with it, a new item should appear in the list of existing types of residential premises established by the Housing Code of the Russian Federation - residential apartments.

If granted such status, they would be allowed permanent residence, permanent registration, etc. The conditions and procedure for appropriation would be established by local authorities in each subject of the Russian Federation.

The bill also provided for the preservation of non-residential character for those apartments that are used for trade, offices, etc.

In particular, it was intended to divide residential and non-residential apartments according to:

• maximum dimensions (area);
• floor arrangement;
• fire safety, technical and sanitary standards.

At the same time, the existence of both residential and non-residential premises was allowed in one building. Such a building would receive the status of a multifunctional building.

However, in October 2018, work on the bill was stopped and it was withdrawn from consideration. For now, apartments will not be equated to apartments – at least not in the near future.

Each buyer will have to decide on changing the status of his apartment to residential at his own discretion. However, you should not count too much on success. Most likely, the transfer will not take place due to non-compliance with technical standards. And even with favorable developments, the transfer procedure will require significant effort and investment.

What's wrong with the bill on transferring apartments to housing

Attempts to equate apartments with housing fail every now and then. The other day, according to media reports, the Ministry of Economic Development refused to support another bill that would equalize the rights of home and apartment owners.

The bill “On amendments to certain legislative acts of the Russian Federation in order to regulate the legal status of multifunctional buildings and residential apartments,” which experts from Maxim Oreshkin’s department did not like, was submitted to the State Duma for consideration in June. The document proposes to transfer apartments to housing status, which will restore buyers’ allegedly violated rights - from the inability to obtain registration to the lack of social infrastructure.

Why convert a commercial property to residential real estate status? The bill explains this by caring for citizens. However, for “residential apartments” the document does not provide any standards or requirements.

However, the bill does not provide for permanent registration in residential apartments, so children will still not be able to go to these “neighboring” kindergartens and schools.

What's the result? The premises seem to be residential, but it is impossible to send children to a kindergarten or school at their place of residence, as well as to obtain registration, use the medical services of the compulsory medical insurance system, and social benefits.

You will not be able to pay utility bills at residential rates and receive subsidies and reimbursement of expenses. It turns out that this is a disservice to buyers and a blatant setback for housing developers.

Apart-hotels are hotel facilities for temporary accommodation; they require hotel, rather than residential, infrastructure. Developers initially did not build schools and gardens in such projects. And the buyers knew that they were purchasing a commercial property for investment or their own needs, but not for living.

So what is this law for? From July 1, 2023, all apartment complexes must, in accordance with the law “On the Fundamentals of Tourism Activities in the Russian Federation...”, undergo a classification procedure.

And the transfer of apartments to the category of residential real estate will allow builders of “pseudo housing” to avoid classification and the difficulties associated with it.

And it will not at all prevent buyers of “residential apartments” from renting them out - however, this is already illegal.

Of course, legislators want to legalize the “sins of the past.” However, it is important not to destroy urban planning policy, social security of citizens, and the civilized tourism industry.

Lost in translation: how to turn an apartment into an apartment

First, let's figure out why buyers of expensive apartments need to transfer them to housing stock. Players in the luxury housing market tirelessly insist that clients do not see any difference between residential and non-residential stock, since every rich person already has several apartments and cottages, and therefore the possibility of registration does not matter. But what are things like in reality?

“According to our statistics, registration in an apartment is important for 15–25% of their potential buyers,” shares Yulia Kravchuk, head of the agency services department of the residential real estate department of SA Ricci. “As a rule, these are people moving to the capital from other cities or CIS countries, and apartments in this case are their only housing in Moscow.”

In particular, according to Igor Bychenko, director of the real estate sales department of the Hals-Development company, in the IQ-Kvartal complex, located in Moscow City, about 20% of buyers are residents of other cities. Moreover, when counting, not everyone falls into the “nonresident” column, but only those who purchase real estate in the capital for the first time, notes managing partner of ZIP Realty Evgeniy Skomorovsky.

Step by step

Today, the step-by-step transfer scheme is as follows: first, says Elizaveta Nekrasova, general director of the luxury real estate bureau Must Have, you need to write an application to the Department of Housing Policy and Housing Fund of the city of Moscow, and then receive an extract from the order to transfer the premises from non-residential to residential. A similar extract from the protocol of the city interdepartmental commission on the use of the housing stock of the city of Moscow must be attached to this document. Next, provide an act of completed reconstruction or redevelopment.

BTI makes appropriate changes to the accounting and technical documentation for the facility. If the outcome is successful, the department sends a copy of the order to the department of the Federal Service for State Registration, Cadastre and Cartography for Moscow to make changes to the Unified State Register.

“Officially, translation looks uncomplicated and is carried out in a “one-window” mode,” adds Elizaveta Nekrasova. “However, the process can drag on for years, since there are dozens of reasons for refusing a transfer.”

Under threat of demolition

Nevertheless, precedents for translation exist. The first case, says independent real estate market analyst Yuri Kochetkov, occurred even before the term “apartment” appeared.

In the mid-2000s, the “Fantasy Island” project, located in the Tatarovskaya floodplain of the Krylatskoye district, entered the market.

Legally, the land on which it was built was intended for sports and recreation, and the premises were “for temporary residence.”

The inconsistency of real estate objects with the purpose of the land plot led to difficulties in registering ownership rights. And the buyers had to act through the courts, transferring their property to the status of permanent housing, and only after that register the rights to the property.

Moreover, the expert adds, buyers had a special incentive to obtain the status of full-fledged housing: the Moscow authorities challenged the legality of the construction, even demanding the demolition of illegally erected structures. But demolishing constructed housing that is registered with Rosregistration is much more difficult.

Story one: building density

A little later, Sergei Polonsky’s Mirax Group managed to change the status of the apartments to housing. During the construction of the Kutuzovskaya Riviera project, built in 2007 on Nezhinskaya Street, the developer exceeded the building density by approximately 10%.

And this extra “tenth” was sold as non-residential premises. After some time, Mirax Group offered apartment buyers to transfer them to housing for $90 thousand using an administrative resource.

However, as a source well familiar with this story, who wished to remain anonymous, noted, the apartment buyers were the winners. For example, an apartment with an area of ​​117 sq.

meters, located on the 27th floor of the Kutuzovskaya Riviera residential complex, cost $1.34 million, while an apartment of the same area on the floor below cost $1.1 million.

Story two: following standards

Something similar happened with the Bogoslovsky 12 project, built in 2010 as part of the Sytinsky residential complex. Seven floors of this house were initially given the status of housing, and the eighth – apartments.

However, as Oksana Diveeva, head of the elite real estate block of the Best-Novostroy company, notes, even at the construction stage the developer announced to buyers that in the future it would be possible to convert apartments into housing.

And after the facility was handed over to the state commission, he kept his promise.

Natalya Nemchaninova, director of the department of luxury new buildings at the Usadba agency, adds that in this project, when designing the apartments, the technical requirements for residential premises were initially observed: standards for sound insulation, lighting, minimum footage of rooms, width of load-bearing openings, requirements for the thermal circuit, fire safety and engineering systems.

Story three: according to the laws of the market

When it comes to transferring from apartments to housing, realtors most often recall the Legends of Tsvetnoy complex, built in 2010 by Capital Group. Initially, this project entered the market as a business center with apartments.

But at the stage of completion of construction, says Natalya Nemchaninova, the apartments in it received the status of non-residential premises.

Capital Group refused to comment on the history of the transfer, but elite market participants believe that the market situation prompted the change in the legal status of the developer.

“The apartments in this complex were large in size and sold poorly, since the project is aimed at the luxury segment,” explains Irina Mogilatova, managing partner of the TWEED real estate agency. “And after the transfer to the housing stock, the attractiveness of the apartments increased significantly, and they became liquid.”

Story four: a tribute to history

Initially, the mansion on Prechistensky Lane, built in 1912 according to the design of the German architect Gustav Helrich, was a residential building. However, during Soviet times its status was changed. Vesper renovated the mansion a few years ago.

The areas of the project, called “Gelrich House”, were sold as apartments, 10-15% lower than the cost of residential analogues. However, in 2013, by the time construction work was completed, the buyers approached the developer with a proposal to change the legal status of the property, and assumed the costs of converting it into housing.

This operation took Vesper four months to complete. True, it was not possible to find out any details from the developer.

Back to the Future

In the near future, the Moscow government will most likely tighten the standards for apartments, and then the number of developers wishing to convert them into residential real estate will increase.

“For now, the apartments are in a more favorable position in terms of construction costs and it is more profitable for the developer to sell them 10–15% cheaper than to change the project,” argues Irina Mogilatova. “However, after the innovations the situation will change radically.”

That is, everything will return to the standard scheme: developers will build housing. And apartments will gradually leave the market.