Residential and non-residential stock - what's the difference?

The terms "non-housing" and "housing" are often used. Many people are interested in how real estate differs from each other and how to re-design the premises from residential to non-residential.

The change in category is caused by various reasons, usually it is related to receiving benefits from running a business or renting out real estate. The difference between residential premises and non-residential premises and the peculiarities of the change of status are the main points that we will consider in this material.

Differences between non-residential and residential funds

Non-residential premises are real estate, which legally does not provide for the possibility of human habitation, but is intended for use for the purpose of commercial profit. Accordingly, it is not possible to register a person in such objects, while the status of residential real estate involves registration of permanent or temporary registration of natural persons. In order to better understand what residential and non-residential premises mean, we note the differences in the list:

• Business. In order to obtain the right to conduct business in an apartment, registration of the owner and manager of the business in the same apartment is required. To carry out various types of work, sometimes it is enough for businessmen to own or rent a suitable non-residential building, this will allow the use of real estate for any production purposes, while this is not always possible in an apartment.
• Utilities. Real estate from different funds is serviced at different rates — the payment for housing and communal services services in apartments is much lower. But if a commercial activity is conducted in a residential premises, according to the law it is necessary to conclude a new contract with the service organization and pay "business" tariffs. For this reason, many owners, when they learn what a non-residential fund is, do not even connect gasification and heating services, leaving only electricity and cold water.
• Price. Zhitlova and non-residential real estate differ significantly in price, the second option is usually at least 20% more expensive than an equivalent residential apartment.

Many individuals and legal entities are interested in what non-residential premises are. Practice shows that re-registration of real estate may be necessary for a number of reasons:

• Entrepreneurs will turn purchased properties in multi-apartment buildings on the first floor into pharmacies, small shops, delivery points or offices.
• Non-residential premises are buildings that cannot be used for living. Therefore, if the owner wants to issue a residence permit and live here, he must issue it to the residential category.

What documents need to be prepared for re-registration

If all the preparatory measures are completed in accordance with the legislation, it is necessary to contact the Unified Center for the Provision of Administrative Services, where documents are submitted for consideration:

• The application for real estate transfer to another fund must be signed only by the owner of the premises and must be made in accordance with the terms of the Housing Code.
• Document on ownership of the object to be transferred.
• Documents issued by BTI: plans and technical passports. When the house is multi-story, a plan of each floor is required.
• A plan for the future redevelopment of the premises, if the work will be carried out after the change of status.

An application for re-registration to a residential or non-residential premises is considered within 45 working days. After this deadline, the authorized bodies must notify the owner of the decision within 3 days. The answer is sent by mail, e-mail or to the administrative center where the documents were submitted. By the way, if you decide buy a house in Kyiv, we recommend contacting the best elite real estate agency THE

Residential and non-residential premises: the difference and possibilities of each

It should be taken into account that under the terms of the Residential Complex of Ukraine, Article 17, business activity in a residential premises is permissible only if the following conditions are met:

• Local residents will not feel discomfort from your commercial activity.
• The building where the accommodation is located does not belong to the old fund, so it is not planned to be demolished in the near future.
• The entrepreneur is registered in the square where he conducts commercial activity.

That is, a businessman can live comfortably in an apartment, pay all utilities at an affordable price compared to a non-residential fund, and earn a steady profit. Nevertheless, understanding what residential and non-residential premises are, many managers still change the status of housing to commercial, since there is a significant plus here. For example, an apartment in a non-residential fund becomes more expensive if it is put up for sale. For those considering housing and non-housing funds, lawyers also recommend taking into account:

• How popular is the property and can it be sold quickly?
• The procedure for processing documents for the object, as it can take a long time.
• A simple room does not exempt from payment of utility services, which are approximately 2 times higher for a non-residential fund. Plus you will have to pay an annual property tax depending on the residual value of the premises, the exact percentage is determined by local authorities.

Therefore, many experts, whose field of activity is a non-residential fund, claim that this is a special group of real estate that requires experience and knowledge of current legislation.

See also: What is self-development and how to legitimize it?

Transfer of real estate to non-residential status: features

The process of transferring real estate from one fund to another is a complex and lengthy process. The Residential Complex of Ukraine prescribes a number of requirements, they follow a mandatory procedure. If you need to transfer an object from a residential to a non-residential building, this is work that is carried out only under the following conditions:

• If any redevelopments are planned, they should be legalized in the relevant authorities.
• If the area of ​​the object is more than 100 square meters, you need to organize a second entrance from the street.
• When the room is located higher than the first floor, the entrepreneur will have to change the categories of all objects that are under it. All real estate must become non-residential.
• There must be conditions for engineering communications on the territory of the object.
• Residential and non-residential premises have a significant difference, because in the latter there should not be registered people, so the entrepreneur needs to sign out of the future commercial real estate. Moreover, the object is not recognized as commercial if it is inhabited under a social lease agreement or it is considered a cultural heritage.

Remember: only the owner has the right to change the status of real estate!

What you need to remember when re-registration of an object from a non-residential fund

It is not easy to convert a commercial object into a housing fund, as the buildings must meet certain requirements:

• The object must be of high quality: strong, not included in the emergency fund list, not subject to demolition.
• In the room, it is possible to connect all the communications necessary for a comfortable stay. Sewerage, gas drainage, electricity supply, water supply are meant.
• The facility must comply with safety regulations and be equipped so that future residents do not encounter life-threatening situations.

Often, residential and non-residential premises have different ceiling heights - this point should also be taken into account before the translation. It is also necessary to exclude the sources of the appearance of harmful substances in the air, take care of sound insulation. All technical standards are prescribed in the residential complex, and if the premises do not meet them, you can not count on the approval of a change in the real estate category.

During registration, residential and non-residential premises should not be encumbered by collateral obligations, loans or other types of debt.

See also: Where is it better to buy an apartment: in a new building or on the secondary market?

Residential and non-residential space: nuances

• Remember, orders, bills and encumbrances are sent in the name of the owner of any property.
• The area, layout and other technical information in the documents must correspond to the actual data.

So that during the transfer of real estate from one category to another, difficulties do not arise due to ignorance of the law, you should not neglect the help of experienced lawyers. Subscribe to our updatesreal estate portaland receive the latest publications from the real estate agency THE Capital.